Stocks Fall as Pound Regains Ground After Selloff
October 07 2016 - 4:10AM
Dow Jones News
Stocks turned lower Friday ahead of the U.S. jobs report, while
the British pound began to recover after briefly plunging over 6%
in Asian trade.
The pound was last up 0.7% against the dollar at $1.2438 after
falling to as low as $1.1819, its lowest level in over three
decades, during Asian trading hours. The selloff began after French
President Franç ois Hollande called for tough exit negotiations as
Britain leaves the European Union. Market participants said the
decline was accelerated by computerized trades at a time of low
liquidity.
"It is still early days to determine the end-result but one
thing seems certain: sterling will remain under severe pressure,"
said Vasileios Gkionakis, head of currency strategy at UniCredit
Research.
London's export-heavy FTSE 100 index, which tends to move
opposite to the British currency, rose 0.6% in the early minutes of
trading, even as the pan-European Stoxx Europe 600 edged down
0.2%
The moves came on the heels of a mildly downbeat session in Asia
as concerns over the U.K.'s access to the single market dampened
sentiment. Japan's Nikkei Stock Average fell 0.2%, while shares in
Hong Kong fell 0.6% and shares in Australia fell 0.3%.
Futures pointed to a 0.3% opening loss for the S&P 500, as
investors looked ahead to the monthly U.S. jobs report due later in
the day. U.S. government bond yields closed at a four month high on
Thursday as investor expectations grew for a robust reading.
Write to Riva Gold at riva.gold@wsj.com and Saumya Vaishampayan
at saumya.vaishampayan@wsj.com
(END) Dow Jones Newswires
October 07, 2016 03:55 ET (07:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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