The pound tumbled on Thursday as the queen set out Prime Minister Boris Johnson’s legislative plans, prioritizing Brexit and the Bank of England held interest rates.
The domestically focused FTSE 250 MCX, -0.06% recovered from earlier losses to trade 0.1% down following the Queen’s Speech, while the FTSE 100 UKX, +0.34% climbed 0.4%.
The pound GBPUSD, -0.4282% briefly stopped falling earlier on Thursday before tumbling 0.6% to $1.301 as fears of a hard Brexit returned.
The contents of the speech were largely as expected and had been priced in by markets.
The queen said the government’s priority was to “deliver the United Kingdom’s departure from the European Union on 31 January,” bringing forward legislation to ensure the scheduled date is met.
She added that ministers will then seek a future relationship with the EU based on a free-trade agreement and begin trade negotiations with “other leading global economies.”
The speech, setting out the government’s legislative plans, introduced an extensive program of domestic reform, including the NHS — a major talking point throughout the election campaign as Johnson’s opponents claimed the health service was up for sale to the U.S.
U.S. stock futures were also subdued but pointed to a slightly higher open despite the Democratic-led House of Representatives voting to impeach President Donald Trump over abuse-of-power and obstruction-of-Congress charges. Trump is expected to be cleared by the Republican-controlled Senate.
Central banks are again in focus as the Bank of England held interest rates at 0.75% but said it could cut rates if “global growth fails to stabilize or Brexit uncertainties remain entrenched.” The Bank of Japan held rates but kept an upbeat outlook on the economy.
Which stocks are active?
NMC Health shares NMC, -11.36% plunged 13% in early trading as investors continued to be spooked by allegations leveled against it by short seller Muddy Waters. The London-listed health-care provider hit back against the claims, which alleged that the company underreported its debt and paid excessive valuations in a number of transactions, calling them “unfounded, baseless and misleading.”
Shares in Capita CPI, -5.20% fell 4.4% after Deutsche Bank downgraded the U.K. outsourcer to a sell rating with a 155p price target saying the postelection bounce had gone too far.
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