Pound and U.K. stocks fall as Boris Johnson ramps up hard Brexit fears

The pound and U.K.-exposed stocks fell on Wednesday as renewed fears of a hard Brexit spooked investors.

The FTSE 100












UKX, +0.21%










 made slight gains but the domestically-focused FTSE 250












MCX, -0.12%










 fell 0.4% as Boris Johnson ramped up the chances of a hard exit from the European Union.

The pound












GBPUSD, -0.0382%










 slipped a further 0.5% to $1.3069, having reached $1.35 in the aftermath of Johnson’s election victory last week.

U.K.-facing stocks, which soared after the Conservatives secured a strong majority in the election, tumbled on Wednesday.

What’s moving the markets?

The Prime Minister moved to block any further delays to Brexit on Tuesday, introducing a law banning an extension beyond December 31, 2020. With just over a year to negotiate a U.K.-EU trade deal, concerns over a hard Brexit returned.

Wall Street climbed to record highs late on Tuesday on relief over the interim U.S.-China trade deal announced last week, but British stocks were held back on Wednesday by renewed Brexit fears.

The internationally-exposed FTSE 100 nudged 0.1% higher off the back of the weaker pound but the FTSE 250 suffered losses.

U.K. inflation held steady at 1.5%—the lowest level in three years—despite chocolate prices rising. House price growth hit its lowest level in seven years, rising just 0.7% in the year to October.

Which stocks are active?

Pearson












PSON, +1.71%










 shares climbed 2.7% as the educational publisher said it would sell its remaining 25% stake in publisher Penguin Random House for $675 million. Chief Executive John Fallon will also retire in 2020, the company said.

Royal Mail fell 3.1%, house builder Persimmon dropped 3.5% and challenger bank Virgin Money slipped 2% as domestic stocks lost some of their postelection gains.