Eq: Dev ex-US

(London)

A couple of days ago UK prime minister Theresa May called a surprise snap election in the UK. Unexpectedly, she announced that she would seek Parliament to approve a general election on June 8th. Parliament has now approved that request with a dominant majority. That means the Labour party will have just a few short weeks to mount a campaign against the Conservatives. May believes an election is needed now in order to ensure a strong mandate, and thus bargaining position, with the EU as she negotiates for a good Brexit deal.


FINSUM: May proved herself to be very shrewd. The election is so close, it is not nearly enough time for the opposition to mount a well-executed campaign.

Source: Wall Street Journal

(Paris)

The French election is casting a dark shadow over markets as the country heads to the polls this weekend. The race has four main competitors, but it is increasingly looking like a nightmare scenario for markets: candidates from the far right (Marine Le Pen) and the far left (Jean-Luc Melenchon) are likely to make it through to the final round of voting on May 7th. That would mean no mainstream candidates in the final round of the election, or a lose-lose for markets. Le Pen wants to take France out of the Euro, and Melenchon has far-left economic policy.


FINSUM: Look out for the Euro and European bonds to get hammered as the votes become clear. If Le Pen wins expect doubts about the future of the Euro/EU to be running high.

Source: Wall Street Journal

(London)

After nine months of posturing, arguing, deliberating and legal wrangling, the UK officially triggered its exit from the EU today. The legal mechanism for the the UK to leave the EU is called Article 50, and today PM Theresa May officially triggered it by sending a formal letter to the president of the EU notifying of the UK’s intention to leave. The triggering means there is exactly two years until the UK departs the EU, a period which will be full of negotiations between them. The Pound rose on the news.


FINSUM: While there is still some debate over whether Article 50 is revocable, this is pretty final—the UK is leaving the EU.

Source: Independent

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