(Alliance News) - FTSE 100 index in London was trading lower on Thursday morning as sterling rose after UK MPs approved the post-Brexit trade deal with the EU.
The London Stock Exchange will close for trading at 1230 GMT on Thursday for New Year's Eve. Paris also closes early on Thursday, while the Frankfurt equity market is shut entirely. Wall Street has a normal trading day for shares, though US bond markets close early.
The FTSE 100 index was up 90.73 points, or 1.4%, at 6,465.09 early Thursday. The blue-chip stock measure was held back by a rising pound, which reduces the value of overseas earnings.
The mid-cap FTSE 250 index was down 172.73 points, or 0.8%, to 20,542.38. The AIM All-Share index was up 0.1% at 1,153.79.
The Cboe UK 100 index was down 1.5% at 642.72. The Cboe 250 was down 0.6% at 18,070.92, and the Cboe Small Companies flat at 11,756.85.
Gold was quoted at USD1,892.00 an ounce early Thursday, higher than USD1,885.33 on Wednesday. Brent oil was trading at USD51.40 a barrel, up from USD51.30 late Wednesday.
Sterling was quoted at USD1.3657 early Thursday, higher than USD1.3593 at the London equities close on Wednesday.
"There was always an element of risk and uncertainty that the House of Commons may not agree with the Brexit deal. But now, investors know that everyone is behind this trade deal, and there is no more uncertainty when it comes to Brexit as everyone knows what to do and how to minimize the damage," said Avatrade analyst Naeem Aslam.
The post-Brexit trade bill received royal assent from Queen Elizabeth II, Commons Speaker Lindsay Hoyle said in the early hours of Thursday, meaning it is now officially law in Britain.
The legislation, officially called the EU (Future Relationship) Act 2020, sets out the trade rules between Britain and the bloc from January 1.
On Wednesday, it was presented to the UK Parliament where elected lawmakers in the House of Commons voted 521 to 73 - a majority of 448 - in support of the deal.
It then received an unopposed third reading in the unelected House of Lords after nearly eight hours of debate.
Shortly after the House of Lords result, the Queen gave it her official stamp of approval, officially turning the bill into British law.
The Brexit transition period ends at midnight Thursday.
The euro traded at USD1.2295 early Thursday, up slightly from USD1.2287 late Wednesday.
In London, FirstGroup was up 2.6%, the second best performer among the mid-caps, after reporting three property disposals in the US and Canada, for total gross proceeds of USD137 million, as part of its programme to rationalise Greyhound's property portfolio.
The largest is the sale of Greyhound's oversized legacy garage and customer terminal facility in the downtown arts district of Los Angeles, California, to a subsidiary of Prologis. The agreement was finalised on Wednesday and FirstGroup said it will receive net USD88 million in cash and will lease back the facility from Prologis for two years. The Los Angeles site had a book value of USD11 million as at September 30.
The other two property disposals are of facilities in Denver, Colorado, to be sold for net proceeds of USD37 million, and in Ottawa, Ontario, for net proceeds of USD7 million.
In total, the three properties' book value was USD24 million as at September 30, resulting in a total profit on sale for all three transactions of USD100 million, net of leaseback, property tax and selling costs.
The cash proceeds from the transactions will be used for general corporate purposes, FirstGroup said.
Among the small caps, Countrywide jumped 13% in morning trading, after agreeing to a raised takeover offer from peer Connells.
Countrywide shareholders will receive 395 pence in cash for each share. The new agreed price is up from 325p offered at the start of December, with that offer itself representing a 30% increase from an earlier offer from Connells. The price represents a 172% premium over Countryside's unaffected price.
Connells said it has received written confirmations of support for the acquisition from Countrywide shareholders in respect of 16.8 million shares, representing 51% of Countrywide's equity.
The acquisition will be implemented by way of a court-sanctioned scheme of arrangement between Countrywide and Countrywide shareholders and is expected to complete in the first quarter of 2021.
"Following a thorough evaluation of options and extensive consultation with the company's major shareholders, we have been encouraged by their recognition of the need to put in place a sustainable capital structure and a willingness to support the company, which is a great business that has been constrained by too much debt," said Countrywide Acting Non-Executive Chair David Watson.
In Asia on Thursday, Tokyo was closed for New Year's Eve. Against the yen, the dollar was quoted at JPY103.13, down from JPY103.30 on Wednesday afternoon in London.
In China, the Shanghai Composite closed up 1.7%, while the Hang Seng index in Hong Kong closed up 0.3%. The S&P/ASX 200 in Sydney closed down 1.4%, after a shortened trading session.
China has confirmed its first case of a new coronavirus variant that was recently detected in Britain, health officials said.
The new strain, which experts say potentially spreads faster than the original variant, has prompted travel restrictions on the UK by more than 50 countries – including China, where the coronavirus first emerged late last year.
The patient was found to have a strain different to those found in Shanghai or Wuhan earlier, and further testing confirmed it was the variant known as B.1.1.7 that has been spreading in the UK since October.
Health authorities have carried out contact-tracing, the CDC statement added.
China suspended direct flights to and from Britain indefinitely on December 24 because of the new strain.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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