LONDON, Oct 15 (Reuters) - Sterling jumped against the
dollar and the euro while British stock prices and government
bond yields rose in late afternoon trading on Tuesday after a
Bloomberg report that British and European Union negotiators
were close to a Brexit draft deal.
The pound jumped more than 1% versus the dollar to $1.2742
and by a similar margin against the euro to 86.31 pence. The
FTSE250 of UK mid-cap stocks was last up 1.6%.
"A deal between the UK and EU was 60 percent in the price
and now we stand to see if the remaining 40 pct come into play
so the pound is rallying," said Stephen Gallo, European head of
FX markets at BMO.
British government bond yields shot higher. The two-year
gilt yield rose to its highest level since Sept. 16
at 0.575%, up around 7.5 basis points on the day.
The move rippled over into the broader European bond market
with the 10-year German government bond reaching 2.5 month
highs, up 4 basis points at -0.41%.
European equity benchmarks accelerated their gains on the
news with the STOXX 600 over 1%, Germany's up
1.2%, France's CAC40 up 1.2%
(Reporting by the London Markets Team; Editing by Mike Dolan)