stats
globeinteractive.com: Making the Business of Life Easier

   Finance globeinvestor   Careers globecareers.workopolis Subscribe to The Globe
The Globe and Mail /globeandmail.com
Home | Business | National | Int'l | Sports | Columnists | The Arts | Tech | Travel | TV | Wheels
space


Search

space
  This site         Tips

  
space
  The Web Google
space
   space



space

  Where to Find It


Breaking News
  Home Page

  Report on Business

  Sports

  Technology

space
Subscribe to The Globe

Shop at our Globe Store


Print Edition
  Front Page

  Report on Business

  National

  International

  Sports

  Arts & Entertainment

  Editorials

  Columnists

   Headline Index

 Other Sections
  Appointments

  Births & Deaths

  Books

  Classifieds

  Comment

  Education

  Environment

  Facts & Arguments

  Focus

  Health

  Obituaries

  Real Estate

  Review

  Science

  Style

  Technology

  Travel

  Wheels

 Leisure
  Cartoon

  Crosswords

  Food & Dining

  Golf

  Horoscopes

  Movies

  Online Personals

  TV Listings/News

 Specials & Series
  All Reports...

space

Services
   Where to Find It
 A quick guide to what's available on the site

 Newspaper
  Advertise

  Corrections

  Customer Service

  Help & Contact Us

  Reprints

  Subscriptions

 Web Site
  Advertise

  E-Mail Newsletters

  Free Headlines

  Globe Store New

  Help & Contact Us

  Make Us Home

  Mobile New

  Press Room

  Privacy Policy

  Terms & Conditions


GiveLife.ca

    

PRINT EDITION
Traders expecting muted response to U.K. Parliament's Brexit vote next week
space
space
By LAWRENCE WHITE, BEN MARTIN
REUTERS
  
  

Email this article Print this article
Saturday, December 8, 2018 – Page B2

LONDON -- As lawmakers gather in Britain's Parliament on Tuesday to vote on the future of the country's relationship with Europe, traders in London's financial hub will be bracing for a potential burst of market turmoil that could affect the Brexit process itself.

Sterling plunged more than 10 per cent in the immediate aftermath of Britain's shock vote to leave the European Union in June, 2016, while US$2-trillion was wiped off global stock markets.

This time, traders expect a more muted response. Prime Minister Theresa May is widely expected to fail in her attempt to win support for her Brexit plan, meaning the immediate market reaction could be limited - unless there is a surprise.

But as her failure would usher in yet more uncertainty over the Brexit process, big market swings may follow - and some commentators have suggested heavy market losses could even convince lawmakers to back Ms. May if she tried for a second vote.

"On the morning after the 2016 referendum result the London Stock Exchange kind of broke because there were such wide spreads on stocks, market makers weren't finding prices," said Laith Khalaf, senior analyst at Britain's biggest direct investment service Hargreaves Lansdown.

"We are less likely to see turmoil like that as people are ready for a range of outcomes this time, but we could see some big swings," he said.

Either way, banks and brokerages will be prepared. Barclays PLC, Investec PLC, JPMorgan Chase & Co. and Nomura Holdings Inc. are among banks in London planning to draft in traders and analysts outside of normal business hours on Tuesday, sources familiar with the matter said, as they prepare for an influx of calls from investors keen to understand or make bets on the implications of the vote. With the result not expected to become clear until around 7 p.m. GMT, London's stock exchange will be closed, meaning it will be sterling - traded 24 hours a day around the world - that will react first.

Nomura has booked hotel rooms, a bank spokesman said, for bleary-eyed traders to use if necessary after a night that could set the future for the £2.8-trillion ($4.7-trillion) British economy for generations.

"We are going to be glued to our trading screens or television wherever we are," said Neil Jones, head of hedge fund foreign-exchange sales at Mizuho Bank Ltd., another Japanese bank in London.

It is not just in London where traders will be gripped by the Brexit vote, with less than four months to go before Britain is due to leave the EU on March 29.

In foreign-exchange hubs such as New York, Hong Kong and Tokyo, traders will watch for signs of Ms. May's deal being voted through - seen as indicating an orderly Brexit and therefore positive for sterling - or rejected, signalling more uncertainty.

"If we see it becomes a true volatility event, then the ability to step away from the desk will be challenged. Of course, arrangements will be made to feed the troops and no doubt there will be a few ales after to unwind," said Chris Weston, head of research at currency broker Pepperstone Group Ltd. in Melbourne.

Traders will be focused on helping investor and corporate clients with what each development in the vote means for them.

Ms. May's compromise Brexit deal has dismayed both supporters of a more decisive break with the EU and those who want ties to remain as close as possible. Her reliance for a majority in Parliament on a Northern Irish party that opposes the deal has made her position precarious. Should she defy the odds, analysts say shares in sectors most directly exposed to the British economy such as banks, insurers, home builders and retailers could surge.

Associated Graphic

British Prime Minister Theresa May, seen on Downing Street in London on Wednesday, isn't expected to win support for her widely criticized Brexit plan.

KIRSTY WIGGLESWORTH/ASSOCIATED PRESS


Huh? How did I get here?
Return to Main Brent_Jang Page
Subscribe to
The Globe and Mail
 

Email this article Print this article

space  Advertisement
space

Need CPR for your RSP? Check your portfolio’s pulse and lower yours by improving the overall health of your investments. Click here.

Advertisement

7-Day Site Search
    

Breaking News



Today's Weather


Inside

Rick Salutin
Merrily marching
off to war
Roy MacGregor
Duct tape might hold
when panic strikes


Editorial
Where Manley is going with his first budget




space

Columnists



For a columnist's most recent stories, click on their name below.

 National


Roy MacGregor arrow
This Country
space
Jeffrey Simpson arrow
The Nation
space
Margaret Wente arrow
Counterpoint
space
Hugh Winsor  arrow
The Power Game
space
 Business


Rob Carrick arrow
Personal Finance
space
Drew Fagan arrow
The Big Picture
space
Mathew Ingram arrow
space
Brent Jang arrow
Business West
space
Brian Milner arrow
Taking Stock
space
Eric Reguly arrow
To The Point
space
Andrew Willis arrow
Streetwise
space
 Sports


Stephen Brunt arrow
The Game
space
Eric Duhatschek arrow
space
Allan Maki arrow
space
William Houston arrow
Truth & Rumours
space
Lorne Rubenstein arrow
Golf
space
 The Arts


John Doyle arrow
Television
space
John MacLachlan Gray arrow
Gray's Anatomy
space
David Macfarlane arrow
Cheap Seats
space
Johanna Schneller arrow
Moviegoer
space
 Comment


Murray Campbell arrow
Ontario Politics
space
Lysiane Gagnon arrow
Inside Quebec
space
Marcus Gee arrow
The World
space
William Johnson arrow
Pit Bill
space
Paul Knox arrow
Worldbeat
space
Heather Mallick arrow
As If
space
Leah McLaren arrow
Generation Why
space
Rex Murphy arrow
Japes of Wrath
space
Rick Salutin arrow
On The Other Hand
space
Paul Sullivan arrow
The West
space
William Thorsell arrow
space





Home | Business | National | Int'l | Sports | Columnists | The Arts | Tech | Travel | TV | Wheels
space

© 2003 Bell Globemedia Interactive Inc. All Rights Reserved.
Help & Contact Us | Back to the top of this page