Boris Johnson’s “firm” October 31 Brexit date evaporated on Tuesday as British MPs confirmed Johnson’s Brexit plan but rejected his three-day timetable to push his Brexit deal through Parliament. The vote crushed all hope of confirming the historic Brexit by the end of this month and sent a request to Brussels for a third Brexit extension request which would move the exit date to January 31, 2020. In a vote of 322 to 308, MPs expressed concern that it would take more than three days to review the 110-page Brexit Bill.
Johnson responded to the verdict by commenting that he will demand a snap general election if Brussels grants a three-month Brexit delay. European Commission President Donald Tusk has said that a Brexit delay will be inevitable, though he hasn’t confirmed how long it will be.
The British pound eased against the U.S. dollar in Asian trade on Wednesday, trading down 0.10 percent as of 1:09 p.m. HK/SIN to $1.2859. The pound is now on its longest streak of significant one-day moves in the past ten years, having moved in greater than 1 percent range for the past nine consecutive days. The last such similar stretch was immediately following the Brexit vote. The pound has moved from a one-month low against the dollar to a give-month high in the past week as traders expressed optimism about the Brexit confirmation. On October 15 the pound closed above its 200-day moving average for the first time in five months, and analysts predict that a further upside is possible as talks progress, despite yesterday’s setback.
Asian markets were mostly lower on Wednesday afternoon as traders took Brexit concerns in stride. Japan’s Nikkei 225 was the only index to post gains, trading up 0.11 percent in the early afternoon. Hong Kong’s Hang Seng Index eased 0.95 percent, while South Korea’s Kospi was down 0.44 percent. China’s benchmarks, the Shanghai Composite and the Shenzhen Composite were down 0.32 percent and 0.31 percent respectively. Also pressuring Asian shares were concerns that the global microchip industry is facing a decline in demand due to the U.S.-China trade war. The concerns came after late-afternoon reports from Texas Instruments forecasted a decline of up to 17 percent in the company’s revenue, well below estimates. The report sent Texas Instruments prices down nearly 10 percent in after-hours trading and spread concern to other chipmakers such as Nvidia and Intel, sending share prices lower and sparking concerns about the state of the global economy.