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Lady Hale, president of the UK’s highest court, said Boris Johnson’s decision to suspend parliament for five weeks until mid-October was “void and of no effect”
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FTSE 100 down 11 points
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Sterling jumps as Supreme Court rules prorogation unlawful
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Parliament could return as soon as tomorrow
10.55am: UK Supreme Court unanimously rules prorogation of Parliament unlawful
The UK Supreme Court, the country’s highest legal authority, has unanimously ruled that Boris Johnson’s prorogation (suspension) of Parliament is unlawful.
On Tuesday morning, Lady Hale, president of the Supreme Court, said the decision by the government to suspend parliament for five weeks until mid-October had “no justification” and that the prorogation was null and void and should be quashed.
“The prorogation was void and of no effect,” Lady Hale said, adding that as a result Parliament had “not been prorogued”.
Unanimous Supreme Court rules in all three judgements that Johnson’ suspension of Parlisment is illegal, Parliament must resume
— Jon Snow (@jonsnowC4) September 24, 2019
Shortly after the judgement was delivered, the pound jumped 0.37% to US$1.2475 against the dollar and 0.31% to €1.1339 against the euro, as the chances of Johnson’s government forcing through a no-deal exit without Parliamentary scrutiny now seem to be dead in the water.
The renewed strength of sterling, however, was bad news for the equity markets as the FTSE 100 reversed course and was 14 points lower at 7,311 shortly before 11am.
10.10am: shares hit record low as bond sale flops
Troubled high street lender PLC () saw its shares sink to a new low in mid-morning after failing to drum up enough interest for a £250mln bond sale.
The firm was forced to ditch the debt issuance late on Monday in yet another failure of investor trust following an accounting blunder in February which sent its shares tumbling.
Since then, the shares have lost around 84% of their value and are currently trading around 246.6p, a far cry from the 3,028p level this time last year.
The bank has been trying to raise enough funds to comply with MREL, a new batch of EU regulations that govern how much cash a bank needs to absorb losses and avoid going bust.
However, since its accounting snafu at the start of the year Metro has seen its borrowing costs rocket, sending it cap in hand to investors.
Another prominent mid-cap faller was FTSE 250 post carrier (), which slipped 3.4% to 212.5p after analysts at Liberum stamped the firm with a downgrade to ‘sell’ from ‘hold’.
In a note, the broker cited concerns over the company’s ongoing dispute with its workforce, saying the share price was “at odds” with the deterioration of industrial relations.
The FTSE 100, however, was still managing to stay in the green despite some lost momentum and was up 6 points at 7,331.
8.40am: FTSE 100 trades higher
While torrential rain flooded the Square Mile early on, there was an air of the calm before the storm within the plate glass walls of the City’s major trading houses.
For while the index of blue-chip shares opened 12 points to the good at 7,338.11, uncertainty was the watchword ahead of a Supreme Court hearing that could further paralyse the Boris Johnson administration.
While the UK’s highest judicial body will rule whether it was legal for the Prime Minister to prorogue parliament, it’s the legal nuance that really counts.
A ruling that Johnson misled the Queen through what’s called an “improper motive” would likely prompt calls for the PM’s resignation, causing further political chaos.
On the market, the ripples of the Thomas Cook () collapse were still being felt. TUI () built on Monday’s gains with the demise of a major competitor seen as major boon in the Darwinian world of the London exchange. The shares rose 1.5%, while budget airlines were also on the up.
6.45am: Posiitve start predicted
The FTSE 100 is seen starting positively on Tuesday as Brexit is brought back to the fronts of investor minds.
IG Markets calls the London index around 23 points higher, making a price of 7,350 to 7,353 with just over an hour to go until the open.
Whilst political conference season is rarely short of blather, especially around Brexit, the focus will be on a formal legal forum.
The UK supreme court will later today rule on Boris Johnson’s government’s proroguing of parliament and whether it is ‘justiciable’.
“In what could potentially be an explosive precedent the court could rule that the decision to end the parliamentary session was an illegal act. Both English and Northern Irish courts dismissed the charge of illegal prorogation, while a Scottish court ruled it was illegal, meaning today’s decision could go either way,” said Michael Hewson, analyst at CMC Markets.
“The government’s argument is that the prorogation is at the discretion of the Prime Minister and that MPs have tools available to constitutionally replace the government, including a vote of no confidence, but refuses to do so for political reasons and therefore outside the discretion of the courts.”
“The court on the other hand may choose to disagree, however it may find itself limited in whatever remedies it can infer, though the government has said it will carry out any ruling the court makes.”
The outcome will be watched by political commentators and currency traders alike as it could be an influencer of the pound, Brexit and in turn UK equities.
Over in New York, last night, the Dow Jones closed in slightly positive ground rising 15 points or 0.05% at 26,949.
The S&P 500 meanwhile ended a sliver lower at 2,991 and similarly the Nasdaq finished 0.06% down at 8,112.
In Asia, Japan’s Nikkei rose by 45 points or 0.21% to 22,124 while Hong Kong’s Hang Seng was similarly up 0.3% at 26,300 and the Shanghai Composite moved up 0.54% to 2,993.
Around the markets
Pound: US$1,2430, up 0.01%
Gold: US$1,521, down 0.17%
Brent crude: US$64.42, up 0.2%
Bitcoin: US$9,755, down 1.92%
Significant announcements for Tuesday September 24:
Finals: (), 1pm PLC (), PLC (), PLC (), DX Group PLC (LON:DX), PLC (), Innovaderma PLC, (), Town Centre Securities PLC (LON:TOWN)
Interims: (), PLC (), PLC (), PLC (), (), Everyman Media PLC (), Flowertech Fluidpower PLC (), Minds and Machines Group Ltd (), Moss Bros Group (), PLC (), (), S&U PLC (), (), ()
AGMs: ()
Economic data: UK public sector borrowing, CBI industrial trends, US consumer confidence
Headlines
Thomas Cook collapse: Anger mounts over bosses’ bonuses – Sky News
More than a third of UK bank branches have closed since 2015 – The Guardian
M&S chief financial officer steps down its starts trading as a FTSE 250 company – Mail Online
New York Fed injects $66bn into short-term lending markets – Financial Times
Labour unveils £83bn state windfarms plan before key climate vote – The Guardian
AB InBev prices its Budweiser offering at HK$27, the second biggest IPO this year – CNBC
Elon Musk knew SolarCity was going broke before merger with Tesla, lawsuit alleges – LA Times
