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Good morning. There’s a pathway to a Brexit deal, another day of trade talks in Washington and Renault could get a new CEO. Here’s what’s moving markets.
It’s not a deal, but a “pathway” to a deal: Boris Johson and his Irish counterpart, Leo Varadkar, emerged from their lunch yesterday claiming an agreement for the U.K. to leave the European Union by the end of the month is possible. The pound jumped by the most in seven months as the leaders said they still think an agreement is “in everybody’s interest,” and columnist John Authers says the breakthrough is giving those currency bulls a real reason to hope. Varadkar has another reason to want a settled agreement: if the U.K. leaves the bloc without one, it would cost Ireland 73,000 jobs over the next two years, the Central Bank said.
Stocks rose in Asia after President Donald Trump said trade discussions with China went “very well” and that he plans to meet with the top Chinese negotiator on Friday. Both sides have appeared willing to work toward a partial deal and leave the more controversial issues for later discussions, even though Trump has said he would prefer a complete agreement. The upbeat news on that front was a change from Trump’s troubles at home, as an ally of Rudy Giuliani was accused by U.S. prosecutors of skirting campaign contribution limits as part of a plot to oust the American ambassador to Ukraine, an episode under scrutiny by a congressional committee weighing Trump’s impeachment.
It’s a big week for politics in Eastern Europe. Voters go to the polls on Sunday in Poland, where the Law & Justice party is expected to cruise to a second term. Despite the country being repeatedly sued by the European Union for eroding the rule of law, markets aren’t too worried. While local-currency bonds and Warsaw-listed stocks have trailed emerging-market peers over the past four years, the economy is growing at a pace of as much as 5%. And, of course, Poland still essentially has a government, something Romania can no longer claim after its own was ousted in a no-confidence vote. Romania is now on course for its 17th head of government in three decades – the most of any EU member. Read this to know why it’s happening again.
The French carmaker is poised to oust Chief Executive Officer Thierry Bollore, just days after partner Nissan Motor Co. chose a new CEO, a sign the carmakers are working in sync to move past the Carlos Ghosn era and repair their troubled alliance. Renault is expected to name CFO Clotilde Delbos as interim CEO at a meeting Friday. Resolving differences between Nissan and Renault is a prerequisite to reviving any merger discussions with Fiat Chrysler Automobiles NV, which were scrapped this year after Nissan failed to back a deal.
Asian stocks rose and U.S. futures are up following the trade developments. Keep an eye on ad companies after Publicis cuts its full-year revenue forecast following the close of markets on Thursday. Next week, everyone’s eyes will be turned to the Saudi Aramco IPO getting the green light as the firm targets a value of at least $2 trillion – more than double that of Apple Inc. Before then, runners everywhere will be watching to see if Eliud Kipchoge breaks two hours in the Vienna City Marathon this weekend.
What We’ve Been Reading
This is what’s caught our eye over the past 24 hours.
- Dyson scraps plans for electric cars.
- A burning question: How much would Trump’s moat cost?
- Here’s what to watch to tell if we’re heading toward recession.
- A wild plan to pull gold out of London.
- How Paul Krugman got globalization wrong.
- Could Man United’s potential relegation spur a sale?
- Juul is the new big tobacco.
©2019 Bloomberg L.P.