Sterling sinks 2pc and FTSE slides on travel ban and Brexit chaos

Sterling sinks 2pc and FTSE slides on travel ban and Brexit chaos – li…

posted by titlis December 21, 2020 Travel

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Good morning. With just 10 days to go until the end of the transition period, markets have been rattled by another missed deadline in trade talks between the UK and EU, sending the pound slumping to $1.33.

And if that was not enough for Christmas week, the EU looks set to impose a travel ban on Britain to halt the spread of a mutant strain of coronavirus, which has put 18 million in the South East of England under lockdown and forced ports to shut. FTSE futures are pointing 1.6pc lower 30 minutes before the open.

5 things to start your day

1) Retailers demand more relief as tier 4 threatens further job losses. Stores are haemorrhaging money in London and the South East in what is normally their busiest trading time of the year.

2) Deloitte is one of 18,000 SolarWinds hack victims. IT giant Cisco also hit by huge cyber attack believed to have given Russia access to US government documents for nine months.

3) Shell crew marooned on tankers for Christmas. Crew will be stranded at sea until Jan 4 to prevent spread of Covid.

4) Businesses beg to know when the pain will end. Retailers are on their knees as customers return orders and stores close again after Boris Johnson cancels Christmas.

5) Universities face fight to survive the winter. Courses and campuses could go, with some institutions fighting to avoid going bust after the Government avoided a bailout.

What happened overnight

Asian stocks faltered and the sterling slid on Monday as unease over a new coronavirus strain that was shutting much of the United Kingdom offset news that a deal had finally been struck on a long-awaited US stimulus bill.

The pound sank 1.2pc to $1.3352 after several European countries closed their borders to the UK as the country entered a tougher lockdown to fight a new strain of coronavirus.

Prime Minister Boris Johnson will chair an emergency response meeting on Monday to discuss international travel and the flow of freight in and out of Britain.

That combined with the lack of a Brexit deal to slice 1.1pc off FTSE futures, while EUROSTOXX 50 futures shed 1.7pc.

MSCI’s broadest index of Asia-Pacific shares outside Japan dipped 0.2pc after hitting a string of record peaks last week. Japan’s Nikkei reversed early gains to be down 0.4pc, off its highest since April 1991.