The FTSE 100 is up around 0.4% on the day as the political deadlock in Parliament continues. Yesterday, MPs voted to reject Prime Minister Boris Johnson’s plan to fast-track his Withdrawal Bill through the legislature. It is now up to the European Union to decide whether to grant the UK an extension to the Brexit process.
While it is thought that the EU will agree to the extension request, there remains the possibility that they will not, which would lead to the UK exiting the EU without a deal on 31 October.
If an extension is granted, Johnson has said that he will call a general election, a move that Labour broadly supports. Although it will likely be a messy affair, an election could act as a second referendum on Brexit, allowing either side to gain a majority and break the impasse. Alternatively, it could create an even more fractured group of parliamentarians. In any case, an election within the next few months is looking like the most likely next step.
Metro Bank
Metro Bank founder Vernon Hill was forced to step down as chair today, and to accept an honorary position on the board. Shares of Metro have performed terribly over the last year, losing more than 92% of their value. Metro shareholders have had to deal with one unpleasant surprise after another, from accounting irregularities to last month’s unsuccessful bond issue.
It’s a challenging environment for most banks in general, so Metro’s management aren’t doing their owners any favours by shooting themselves in the foot. Metro reports earnings after the market closes today.
Mining stocks
A number of miners have reported earnings today, with some doing better than others. The biggest winner in the FTSE today was gold miner Centamin, with shares up 5% on the day, thanks to a very positive trading update.
The miner reaffirmed its full-year guidance and reported that it would hit its promised production numbers with 490,000 ounces of gold. This has been an excellent year for gold miners in general, with the precious metal trading above $1,500 per ounce for the first time in almost seven years.
Copper miner Antofagasta also reaffirmed its yearly targets, sending the stock price up 1.3%. The market reacted positively to the news that the ongoing unrest in Chile, where Antofagasta is based, has not affected production.
Not all companies in the industry did well today, however. Mexican miner Fresnillo reported lower production for the year, for both gold and silver. Gold production was down 7% and silver was down 14%. Fresnillo has already decreased its production guidance once this year, and while the new figures are in line with this forecast, they are at the lower end of the range.
