Markets Tread Lower Before Key Brexit Speech

LONDON, , (UrduPoint / Pakistan Point News - 17th Jan, 2017 ) - Europe's main stock markets slid Tuesday but the pound rebounded somewhat, as British Prime Minister Theresa May was set to make a hotly-anticipated speech on Brexit strategy.

London stocks declined as investors reacted also to news that annual inflation jumped to a two-and-a-half year peak at 1.6 percent in December. Britain's premier is expected to say she favours a clean break from the European Union, dismissing a "half-in, half-out" Brexit deal with Brussels.

May, speaking at around 1145 GMT, is likely to give further signals that Britain is heading to what analysts call a "hard Brexit". "Not partial membership of the European Union, associate membership of the European Union, or anything that leaves us half-in, half-out," the prime minister will say, according to an extract of her speech circulated in advance to the media by Downing Street.

"We do not seek to adopt a model already enjoyed by other countries. We do not seek to hold on to bits of membership as we leave," she will add in a speech due in central London. A hard Brexit would see Britain's departure from the single market or tariff-free zone, while also ending the free movement of people.

"European shares are trading moderately lower... ahead of May's speech where she is expected to announce her Brexit strategy," said Markus Huber at trading firm City of London Markets. "Whilst traders are eagerly awaiting her speech due to multiple leaks over the past few days, it might very well be that most of what the speech will contain is already well known in advance and therefore its impact on stocks and the pound should limited."