FTSE 100 to move higher as Boris heads to Brussels for crunch talks

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The FTSE 100 is expected to start Wednesday on the front foot as Boris Johnson prepares to head to Brussels for crunch talks to thrash out a post-Brexit trade deal before Christmas.

Spread-better IG expects the FTSE 100 to open 32 points higher after ending Tuesday’s session up three points at 6,558.

Johnson is scheduled to meet the head of the European Commission Ursula von der Leyen this evening to see if the two can break an impasse that has settled over the negotiations since the weekend. While a deal is not expected to be sealed at the meeting, any progress will likely give a green light for the negotiating teams to resume their own talks on Friday following Thursday’s meeting of EU leaders where the issue of Brexit is also likely to be discussed.

“With optimism and pessimism being displayed in equal measure, it is apparent that the eventual outcome could well go either way, however the stars do appear to be aligning for some form of deal by the end of the month, despite reports that suggest a no deal is becoming much more likely than most would like to admit”, said Michael Hewson at CMC Markets.

“The hope is that the [Johnson and von der Leyen] can push back against the more hawkish voices amongst some in the EU who mistakenly think that somehow a no deal outcome is even an option to be contemplated…Perhaps the calculation is that the UK will back down and fold, however if the PM were to do that there is no guarantee he would be able to sell the sort of compromise that would be acceptable to the EU to the more recalcitrant parts of his party…What is required in the next few hours is less pig headedness and more pragmatism on the part of all parties. There will be no winners from a no deal outcome, whatever either side might tell you. If anything a no deal would be a kind of mutually assured destruction”, he added.

The blue-chip index in London also seems set to follow optimism in US markets overnight, as positivity over the rollout of coronavirus vaccines outweighed uncertainty over a new government stimulus package as well as surging cases of COVID-19.

The Dow Jones Industrial Average ended Tuesday’s session up 0.35% at 30,173, while the S&P 500 rose 0.28% to 3,702 and the Nasdaq climbed 0.5% to 12,582.

Markets in Asia followed the US lead on Wednesday morning, with Japan’s Nikkei 225 up 1.19% while Hong Kong’s Hang Seng rose 0.88%.

Any news on developments in today’s Brexit talks are likely to catalyse more movement in the pound, which has seen enhanced volatility recently as currency markets fret over the prospects of a deal. Sterling is currently up 0.2% at US$1.338 against the dollar.

Around the markets:

Sterling: US$1.338, up 0.2%

Brent crude: US$48.66 a barrel, down 0.37%

Gold: US$1,861 an ounce, down 0.4%

Bitcoin: US$18,196, down 4.9%

6.45 am: Early Markets: Asia / Australia

Asia-Pacific shares were mostly higher as a COVID-19 vaccine rollout commenced in the UK, making it one of the first countries in the world to do so.

Japan’s Nikkei 225 rose 1.33%, South Korea’s Kospi index jumped 1.96% and Hong Kong’s Hang Seng index added 0.88%.

In Australia, the ASX 200 rose 0.61% with major iron ore miners advancing as the price of the metal jumped by about 30% in just six weeks and is near its eight-year high thanks to strong demand from Chinese steelmakers.

Chinese shares were an exception to the overall trend with the Shanghai composite falling 0.55% after China’s consumer price index fell in November for the first time in about a decade as food prices declined.

READ OUR ASX REPORT HERE

Proactive Australia news:

Lithium Australia NL (ASX:LIT) (OTCMKTS:LMMFF) (FRA:3MW) has granted an option for Charger Metals NL to acquire part of the company’s Australian exploration assets as a part of its strategy to offload non-core exploration plays to focus on battery supply chains.

Oklo Resources Ltd (ASX:OKU) expects its maiden mineral resource estimate (MRE) at Seko within its flagship Dandoko Gold Project in Mali to be released in quarter one 2021.

Creso Pharma Ltd (ASX:CPH) (OTCMKTS:COPHF) (FRA:1X8) has soared 88% after subsidiary Mernova Medicinal Inc received three new purchase orders as well as a notice to purchase from the Province of Ontario, marking the company’s entry into Canada’s largest recreational cannabis market.

Kazia Therapeutics Ltd (ASX:KZA) has shared top-line final data from its phase 1 study of Cantrixil (TRX-E-002-1) in patients with persistent or recurrent ovarian cancer (NCT02903771) which demonstrates positive efficacy and safety outcomes.

Archer Materials Ltd (ASX:AXE) (OTCMKTS:ARRXF) (FRA:38A) has entered into a collaboration with leading Artificial Intelligence (AI) and Machine Learning company, Max Kelsen, to develop quantum algorithms relevant to the operation of the 12CQ quantum computing processor.

Tempus Resources Ltd (ASX:TMR) (CVE:TMRR) (FRA:4W0) has exercised the option to acquire the Elizabeth Gold Project in Canada and has completed an addendum to the original Elizabeth option agreement.

Havilah Resources Ltd (ASX:HAV)(FRA:FWL) closed its share purchase plan (SPP) on December 4, 2020, with applications received for $2.72 million – exceeding the target of $2 million.

Piedmont Lithium Ltd (ASX:PLL) (NASDAQ:PLL) (OTCMKTS:PDDTF) intends to re-domicile from Australia to the US via a proposed scheme of arrangement, subject to shareholder, regulatory and court approvals which will cement the company’s position as an important part of the US supply chain.

Kin Mining NL (ASX:KIN) results of up to 5 metres at 27.7 g/t gold from infill reverse circulation drilling at Hobby prospect within the Cardinia Gold Project (CGP) in Western Australia pave the way for a resource upgrade.

Element 25 Limited (ASX:E25) (FRA:QFP) has agreed key commercial terms to sell 50% of the manganese ore produced from the second stage of the Butcherbird Project development to Singapore-based Semeru Energy Ltd.

Emyria confident its unique clinical and data models will help accelerate drug registration

Emyria Ltd (ASX:EMD) has launched its first product EMD-003 – a cannaboid for mental health – and is confident its drug development program will allow it to accelerate drug registration.

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