The FTSE 100 and FTSE 250 are both up nicely in the early exchanges and sterling is holding on to the $1.35 and €1.10 marks, so markets seem to be welcoming the Brexit deal that was announced on Christmas Eve, says Russ Mould, AJ Bell Investment Director.
“However, the agreement struck between London and Brussels is yet to win universal acclaim, even if that is the inevitable result of the compromises that the Prime Minister had to make to get the deal over the line before the end of the transition period and confirmation of the UK’s departure from the economic bloc.
“That there are questions still be to answered can be seen in two ways.
“The first is through the medium of the pound. Sterling may be closing out 2020 at pretty much its highest level against the dollar all year but it is trading much nearer to its 12-month lows than its highs against the euro. Moreover, the pound is still down by 9% against the buck and 15% against the single currency relative to where it stood in June 2016 before the Brexit referendum.”