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(Bloomberg) --

Good morning. Labour has taken a stance on Brexit, kind of. And Trump’s ready to do a trade deal, sort of. Here’s what’s moving markets this morning.

People’s vote

Having faced defections from his party and consistent pressure to take a stance, Labour Party leader Jeremy Corbyn has agreed to back a second Brexit referendum, sort of. Worth noting is Labour support for a second vote isn’t enough to guarantee it will happen, as a big portion of Tories would also have to back the idea. Still, it’s a decision unlikely to lighten the mood in Prime Minister Theresa May's camp, as her government fast runs out of options and the European Union makes clear it sees no alternative beyond delaying the exit date. It seems even May, who has been resolute that the U.K. will leave on March 29, is coming to that conclusion.

“Signing summit”

Encouraging signals on the trade front continue, albeit with a caveat. U.S. President Donald Trump confirmed the deadline for the temporary truce on Friday would be extended and suggested he and Chinese Premier Xi Jinping could have a “signing summit” to seal the deal. But that enthusiasm was at least partly tempered almost immediately, when Trump added that a trade deal “might not happen at all.” Analysts advise no counting of chickens just yet and exporters from both nations are staying wary of any potential change of heart.

Caught in the middle

President Trump’s tweet renewing his opposition to high oil prices on Monday put into stark focus the rock and the hard place between which OPEC is caught. Oil has recovered recently as supply cuts have quelled fears about surging production from the U.S., but the crude cartel now faces a familiar choice. Adding back more supply now will lead to a market rout, but maintaining output cuts to keep prices up will mean facing the wrath of the president. On the current path, Goldman Sachs Inc. sees crude making a fleeting visit to the $70-$75 a barrel range. On Tuesday, though, the Trump-driven losses that started a day prior have held.

Italy’s back

Its been relatively quiet on the Italian front in 2019, after the country’s central role in markets last year, but things are cranking up again. Italian bonds made big gains on Monday, taking the banking sector along for the ride, after it avoided a credit rating downgrade from Fitch. Now the country’s budget is come back to the fore,  with Finance Minister Giovanni Tria saying no adjustments will be needed despite the country edging closer to recession. And regional election losses for Five Star could foster yet further tensions between the ruling parties, even though the populist coalition shrugged it off.

Coming up...

Hopefully no readers will be too fatigued by the cavalcade of central bank speakers in the past couple of weeks because there are more to come. Federal Reserve Chairman Jerome Powell will speak before the Senate Banking Committee and we can expect comments from European Central Bank policymakers Yves Mersch and Benoit Coeure. We’ll have consumer confidence numbers from Germany and France and the Chinese National People’s Congress Standing Committee will meet for two days ahead of the annual congress.

What We’ve Been Reading

This is what’s caught our eye over the past 24 hours.

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