Only sterling reflected the UK parliamentary shenanigans that has been dubbed Cox’s Codpiece as the UK Attorney General judged that the last-minute modification to the UK withdrawal agreement did little to change the legal implications of the Irish “backstop”. It now seems almost certain that the latest “meaningful” vote of the UK parliament later this evening will result in a heavy defeat by the government. The most likely next outcome is a delay in the BREXIT process, the length of which is likely to be limited by the EU Elections in May ’19. It would appear from today’s price action that the markets have already digested this and are unimpressed by the latest plot twist in an ongoing saga of the unknown. UKX rallied 0.3% helped by a 1.2% drop in GBOP: the MCIX was up 0.25% while AIM All-Share was flat on the day. The MCIX did reverse on the day and may well sell-off if there is a heightened level of uncertainty or if a general election seems imminent.
In sectors, O&G Services +1.8% , FS +0.8% with Utilities and Tobacco +0.8% gave the fairly defensive flavour of today’s price action. Beverages, T&L, Pharm and Construction all underperformed.
Oil was up 0.3% while gold rallied 0.4%, silver 06% and copper 0.7%.
Market sentiment remains sanguine with the UK VIX up just 5% at 13.3 while the US VIX is at a very low 13.7 with the Fear Index at 58 showing Greed.
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