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Pound falls on Brexit 'labyrinth'

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The pound dropped on Thursday, weighed down by ongoing chaos in Brexit proceedings, while global stocks were mixed.

[NEW YORK] The pound dropped on Thursday, weighed down by ongoing chaos in Brexit proceedings, while global stocks were mixed.

London's stock market rose, however, buoyed by the weaker currency.

Eurozone markets, having enjoyed modest gains earlier in the session, slipped towards the close, while Wall Street pushed higher as Treasury bond yields stabilised.

British Prime Minister Theresa May will renew attempts to push through her Brexit plan on Friday, after she dramatically offered to quit to save her deal and MPs failed in their own bid to break the deadlock.

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Market voices on:

"The pound has remained under pressure today," said XTB analyst David Cheetham.

"The decline has been fairly steady and not too dramatic in its nature, but the move could well gather momentum in the next few days if the current political impasse shows no sign of abating with no-deal prospects seemingly being resurrected," Mr Cheetham said.

Sterling's fall against the dollar exceeded one per cent, and the currency lost ground against the euro.

'NO CLEAR WAY OUT' 

Connor Campbell, analyst at Spreadex, said there was "no clear way out of the Brexit labyrinth in sight".

Meanwhile top Chinese and US negotiators held their latest round of trade talks in Beijing, with hopes the two economic superpowers can find a deal to end their long-running tariffs row, though it may take time.

White House economic adviser Larry Kudlow said the negotiations are not "time dependent" and could be extended.

The talks are "policy and enforcement dependent" so "if it takes a few more weeks or if it takes months, so be it," Kudlow said in a speech in Washington.

The broad-based S&P 500 advanced 0.4 per cent after the yield on the 10-year US Treasury bond rose. Declines in yields in recent sessions raised concerns about slowing economic growth.

"The market was fearful that the Treasury yields were falling because of recession fears," said Karl Haeling of LBBW.

"The end of the treasury rally took away some of the panic fear."

Earlier on Thursday, Asian stock markets were gripped by volatility as investors grow increasingly worried about the state of the global economy, sending them rushing to haven assets and fueling talk of possible recession.

Tokyo's main stocks index sank 1.6 per cent, with exporters hit by a jump in the haven yen currency, while Shanghai shed almost one per cent.

AFP