UK shares and the pound fell on Wednesday, battered by jitters over Boris Johnson’s Brexit endgame and fears for the world economy after disappointing factory data out of the US.
By 13:39pm, the pound was 0.24 per cent down at $1.2273, after bigger losses earlier in the day. Against the euro, it was 0.21 per cent lower, at €1.1232.
The Daily Telegraph reported late on Tuesday that Mr Johnson’s final Brexit proposal will leave Northern Ireland in a special relationship with the EU until 2025, meaning there may be a regulatory border between Great Britain and Northern Ireland for four years, as well as customs checks between Northern Ireland and the Republic of Ireland.
EU diplomats and officials responded to the report on Wednesday, telling Reuters the proposal “won’t fly”.
In a keenly awaited speech later in the day, Mr Johnson provided few details of his latest Brexit plan. He said it does not involve customs infrastructure at the border.
“We will under no circumstances have checks at or near the border in Northern Ireland,” he said.
Across the Atlantic, a measure of US manufacturing recorded its worst reading since June 2009 in September, according to a release on Tuesday.
“The slump in the ISM manufacturing index to a decade low of 47.8 in September, from 49.1, will reignite fears that the US economy is headed for a recession,” said Paul Ashworth, chief US economist at Capital Economics.
The FTSE100 index of the most valuable companies listed on the London Stock Exchange lost 2.23 per cent by 13:39pm on Wednesday.
All but two stocks in the FTSE100 index were down. One of the exceptions was Flutter Entertainment, formerly known as Paddy Power. Its shares soared after news that it will merge with Poker Stars, creating one of the world’s biggest online betting and gambling companies.
Tesco’s shares were also slightly higher on the day after the supermarket chain reported a healthy rise in first-half profits.
Additional reporting by Reuters
