GET Stock QuotesNews18 APP
News18 English
cricketnext
»
1-min read

British Pound Slips After UK Election Shock, Dollar Gains

The British pound plunged to a seven-week low on Friday after a shock election result cast doubt on Britain's talks to leave the European Union, but global equity markets rallied with key indices on Wall Street hitting new record highs.

Reuters

Updated:June 9, 2017, 10:12 PM IST
facebookTwittergoogleskypewhatsapp
British Pound Slips After UK Election Shock, Dollar Gains
A man counts US dollar bills at a money exchange office in central Cairo on March 7, 2017. (Photo: Reuters/Mohamed Abd El Ghany)

New York: The British pound plunged to a seven-week low on Friday after a shock election result cast doubt on Britain's talks to leave the European Union, but global equity markets rallied with key indices on Wall Street hitting new record highs.

British Prime Minister Theresa May said she would form a government backed by a small Northern Irish party after her Conservative Party lost its parliamentary majority in a vote on Thursday just days before the EU departure talks begin.

After an initial plunge, sterling pared losses against the dollar and euro, while the dollar gained. Safe-haven gold and prices of US Treasuries drifted lower.

The pound shed more than 2 percent against the dollar, dropping as low as $1.2636 before trimming losses.

The impact of the British election on the US markets was limited.

"Markets are celebrating gridlock again, which is a reversal of what we saw after the US election," said Jack Ablin, chief investment officer at BMO Private Bank in Chicago.

Ablin said over the past 12 months, central banks, including the Federal Reserve, have pumped almost $2 trillion into capital markets, which has driven asset prices higher.

"If there's one metric that I'm going track, to determine whether or not I want to stay engaged in risk-taking, it's going to be that liquidity. If I get a sense the Fed or other central banks will start to close up shop on that, we're going to reduce risk," Ablin said.

Equity market rallied, with European shares closing higher after early signs of skittishness. Britain's FTSE 100 index rose 1 percent, and the pan-regional FTSEurofirst 300 index of leading European shares rose 0.36 percent to 1,534.20.

MSCI's all-country stock world stock index <.MIWD00000PUS) gained 0.27 percent.Stocks on Wall Street set new intra-day highs. The Dow Jones Industrial Average rose 98.34 points, or 0.46 percent, to 21,280.87. The S&P 500 gained 10.14 points, or 0.42 percent, to 2,443.93 and the Nasdaq Composite added 3.30 points, or 0.05 percent, to 6,325.06.The dollar rose to a 10-day high against a basket of currencies. The dollar index, which tracks the greenback against six major rivals, was up 0.42 percent at 97.322.The euro was down 0.24 percent to $1.1185 against the dollar, a day after the European Central Bank closed the door on more interest rate cuts.Oil prices steadied after falling sharply earlier in the week on pressure from widespread evidence of a fuel glut despite efforts to curb supply led by the Organization of the Petroleum Exporting Countries.Brent crude oil rose 47 cents to $48.33 a barrel, U.S. crude gained 40 cents to $46.04.US Treasury long-dated yields rose to one-week highs as investors consolidated positions ahead of next week's government debt auctions and a widely expected interest rate increase by the Fed.US 10-year Treasuries were last down 7/32 in price to yield 2.2198 percent.

Read full article
Next Story
facebookTwittergoogleskypewhatsapp
Most Active
Company Price Change %Gain
Axis Bank 464.50 -48.65 -9.48
Reliance 914.50 +40.15 +4.59
MAS Financial S 654.40 +195.40 +42.57
ICICI Bank 263.15 -10.75 -3.92
Dewan Housing 602.50 +10.65 +1.80
Company Price Change %Gain
Aegis Logistics 221.45 -5.35 -2.36
MAS Financial S 654.75 +195.75 +42.65
Axis Bank 464.35 -48.85 -9.52
Reliance 913.75 +39.50 +4.52
Nilkamal 1,664.30 +42.90 +2.65
Top Gainers
Company Price Change %Gain
Reliance 914.50 +40.15 +4.59
Power Grid Corp 213.55 +8.65 +4.22
Indiabulls Hsg 1,358.40 +32.70 +2.47
ONGC 174.45 +3.25 +1.90
Wipro 294.75 +4.90 +1.69
Company Price Change %Gain
Reliance 913.75 +39.50 +4.52
Wipro 295.05 +5.55 +1.92
ONGC 174.20 +3.00 +1.75
Kotak Mahindra 1,096.70 +17.35 +1.61
ITC 270.35 +3.15 +1.18
Top Losers
Company Price Change %Gain
Axis Bank 464.50 -48.65 -9.48
ICICI Bank 263.15 -10.75 -3.92
Bharti Infratel 461.75 -17.45 -3.64
Cipla 611.00 -21.10 -3.34
Tech Mahindra 458.45 -14.55 -3.08
Company Price Change %Gain
Axis Bank 464.35 -48.85 -9.52
ICICI Bank 263.05 -10.85 -3.96
Cipla 610.70 -20.55 -3.26
SBI 244.20 -6.95 -2.77
Lupin 1,048.90 -17.75 -1.66

Live TV