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21st-Mar-2018

Pound surges as post-Brexit transition deal sealed

By AFP, London

The pound rose Monday after Britain and the EU reached a landmark deal on a two-year transition after Brexit that will buy businesses and citizens time to adjust to life after the divorce.
World stock markets jittered, meanwhile, in a Facebook-led tech sell-off and ahead of a feared US interest rate hike later this week, as concerns of a possible trade war sparked by US President Donald Trump's announcement on tariffs also weighed.
"The British pound was the biggest currency mover of the day," said Jasper Lawler, head of research at London Capital Group. "Having the extra two years of continuity should reduce business uncertainty and encourage investment."
But the "unfed elephant in the room", the unresolved Irish border question, kept a lid on sterling's gains, he added.
Rocking the US equity market were Facebook's shares plummeting more than seven percent following reports of a large data breach.
EU Justice Commissioner Vera Jourova called "horrifying" reports that Cambridge Analytica, the data analysis firm hired by Donald Trump's 2016 presidential campaign, stole information from 50 million Facebook user profiles to help design software to predict and influence voters' choices.
"US stocks are solidly lower to begin the week as technology stocks are suffering on news of data misuse surrounding Facebook," said analysts at Charles Schwab.
But the social media giant's downturn was just one factor in a cocktail of reasons for selling stocks.
"Concerns over the potential for a Trump trade war still seem to be weighing on the minds of investors, with a lack of risk appetite still leading to caution in global stock markets," FXTM research analyst Lukman Otunuga said.