The UK Government has published it’s Internal Markets Bill, which proposes overriding aspects of the EU withdrawal agreement signed between the two trading partners last autumn.
Brussels has warned Britain will be breaking international law if it renegades on the treaty.
The row took its toll on the FTSE 250 yesterday as the UK company focused index finished 30 points down on the start of the day.
Further developments in the Brexit row today could cause the FTSE 100 to rally even further.
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1.12pm update: US futures slip ahead of weekly unemployment claims data
The CBOE volatility index hit a near three-month high at the start of a historically tumultuous month of September after a five-month rally in US stocks, led by tech shares and backed by tremendous fiscal and monetary support.
At 6.48 am ET, Dow e-minis were down 145 points, or 0.52 percent. S&P 500 e-minis were down 17.5 points, or 0.51 percent and Nasdaq 100 e-minis were down 46 points, or 0.4 percent.
Walt Disney Co fell 0.6% premarket as sources said Chinese authorities barred major media outlets from covering the release of “Mulan”, in an order issued after controversy erupted overseas over the film’s links with the Xinjiang region.
11.34am update: FTSE 100 slides over emergency Brexit talks and also Morrisons’ drop in half year profit
The supermarket group fell 4.3 percent despite saying it expected profit growth for the full year.
This has taken the FTSE 100 down by 0.7 percent.
BP PLC and Royal Dutch Shell PLC also took a hit on the index after a slide in oil prices.
Ronald Kaloyan, head of European equity strategy at SocGen said: “Markets are moving with heavy caution and we also see investors pulling back on some export-heavy names until the see concrete developments on the Brexit front.
8.32am update: London markets drop
The FTSE-100 index at 8.15am was down 10.42 at 6002.42.
7.51am update: Lloyd’s of London to pay back £5 billion to customers
Insurance market Lloyd’s of London has said it expects to pay out £5 billion to customers for claims that are due to the Covid-19 pandemic.
The company said that it made a loss of around £400 million in the first half of the year, with Covid-19 losses reaching £2.4 billion.
Chief executive John Neal said that the start of the year has been “exceptionally challenging”.
“The pandemic has inflicted catastrophic societal and economic damage calling for unparalleled measures to stifle the spread of the virus, and to get businesses and economies back on their feet,” he said.
6am update: Wednesday trading re-cap
London’s blue-chip index ended higher on Wednesday as weakness in the pound looked to benefit major exporters, while the mid-cap index was held back by consumer stocks on fears of new restrictions on social activity.
The FTSE 100 ended 1.4 percent higher as uncertainty over Brexit talks weighed on the pound. Stocks such as British American Tobacco and Unilever, which make a bulk of their revenue overseas, were the biggest boosts to the index.