SNP leader Nicola Sturgeon says Scotland should have same opportunities as Northern Ireland in Brexit deal

SNP leaders have again insisted that Scotland should be given the “same opportunity” as Northern Ireland to stay in Europe’s single market post-Brexit.

First Minister Nicola Sturgeon warned that without such an arrangement being in place, Scotland would be left competing for investment with a country which was “effectively” still part of the trading bloc.

Her message, echoed by SNP Westminster leader Ian Blackford, came as Theresa May prepared to face her Cabinet in a showdown meeting over the draft Brexit deal.

Ms Sturgeon said on Twitter that the “PM’s approach would take Scotland out of the single market (despite our 62% remain vote) but leave us competing for investment with Northern Ireland that is effectively still in it”.

Her remarks came as Democratic Unionist Party chief whip Sir Jeffrey Donaldson warned the arrangements for Northern Ireland could lead to the break-up of the United Kingdom.

He claimed the deal would in the “long term” leave Northern Ireland closely aligned with the EU and could increase support for Scottish independence.

“It’s about the constitutional and economic integrity of the UK, that is fundamental for us,” he told BBC Radio, adding that the “DUP does not stand alone on this, we have many friends within the Conservative Party and indeed in some other parties, who believe this deal has the potential to lead to the break-up of the UK”.

Scottish Conservative leader Ruth Davidson, who is currently on maternity leave after the birth of her son, and Scottish Secretary David Mundell have both warned they could quit their roles if Brexit threatens to “undermine the integrity” of the UK.

Mr Blackford, an SNP MP, said the two Tories had “got questions to ask”, but added: “I’ll leave that to them.”

He stressed that Scotland should be treated the same as Northern Ireland.

“As far as we understand things this morning it looks as if it’s actually going to a be a different deal for Northern Ireland,” he told BBC Radio Scotland’s Good Morning Scotland.

“If it’s permissible for Northern Ireland to stay in the single market as part of the backstop – and I welcome that for the people of Northern Ireland – then of course Scotland should be given the same opportunity.”

He continued: “Nicola Sturgeon, our First Minister, has been very clear ever since the Brexit vote that we need to respect the votes of the people of Scotland and as a very minimum that means staying in the single market and the customs union, these are our red lines.”

Mr Blackford insisted it was “absolutely right” that the Brexit deal should enshrine the Good Friday agreement, which ended years of conflict in Northern Ireland, and ensure there is no return to a hard border with the Irish Republic.

But he went on: “The key point is that if there is to be a differentiation for Northern Ireland there is no reason why the circumstances in Scotland can also not be respected.

“We need to stay in the single market and the customs union, and the Government in London must listen to us on that.”

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Sterling catches breath before UK cabinet meeting

Sterling steadied after posting its biggest jump in two weeks on Tuesday as investors await the outcome of a cabinet meeting where Prime Minister Theresa May will try to convince her ministers to accept a draft European Union divorce deal.

As the EU braces for the biggest divorce in its history, Brexiteers in May’s Conservative Party have said they would vote the deal down, while the Northern Irish party which props up her minority government questioned whether she would be able to get parliamentary approval. The cabinet will meet at 2pm.

  • Read more: DUP will vote against Theresa May’s Brexit deal over fears it could lead to break-up of UK

“The outcome of the cabinet meeting will be a barometer test on the upcoming parliamentary vote the government will face to get the deal through,” said Fritz Louw, a currency strategist at MUFG in London.

In early trades, the British currency was flat at $1.2967 after briefly jumping more than 1pc on Tuesday to $1.3047.

Brussels diplomatic sources had said they feared any delay in agreeing the text would increase the chances of rejection by May’s ministers or the British parliament.

Reflecting the growing nervousness among market participants over the cabinet meeting, implied volatility on the pound, a gauge of expected swings in the British currency, surged.

Sterling/dollar implied overnight volatility jumped to 23pc on Wednesday, its highest since Britain’s general election in June 2017.

Against the euro, the pound fared slightly better with the currency strengthening 0.1pc at 87.02 pence as concerns about the Italian budget also weighed on the euro.

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Sinn Féin 'won't take up seats to help push through Brexit deal'

There is “no scenario in which Sinn Féin rides in to the rescue” of Brexit by having their MPs vote in Westminster, Mary Lou McDonald has said.

Despite the uphill battle facing UK Prime Minister Theresa May to get the so-called ‘Irish backstop’ approved by the House of Commons, Sinn Féin will not take its seven seats.

Analysts suggest the final vote on a Brexit deal could go down to the wire, creating a situation where seven votes could be enough to swing the result.

Mrs May’s Conservative Party has just 315 out of the 650 seats but cannot rely on hardline Brexiteers such as Boris Johnson and David Davis.

The DUP, which props up her minority government, may also go against the prime minister if Northern Ireland is treated differently to the rest of the UK in the backstop agreement.

However, Ms McDonald said: “Brexit can’t be stopped in our view. There is no scenario in which Sinn Féin rides in to the rescue and stops all of this from happening.

“This, folks, is happening. Our efforts have to be very precisely focused on getting the right deal and the right protections for Ireland.”

She argued that Sinn Féin MPs were elected on the basis that they would not take up their seats in London. Despite not sitting in parliament, they do collect allowances and expenses.

Ms McDonald said it was her party’s job to “ensure that this island, this country, does not become the collateral damage”.

She said EU negotiator Michel Barnier has “our back” and it is up to Taoiseach Leo Varadkar’s Government to secure the best deal for Ireland.

“Brexit will not be decided in Westminster. Brexit will be decided around that negotiating table.

“If we were, which we’re not, minded to enter Westminster just watch the law of unintended consequences. Be very sure it would have a political effect in terms of remain Tories.”

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Cathay Pacific executives grilled over data breach 'crisis'

HONG KONG (Reuters) – Cathay Pacific Airways (0293.HK) said on Wednesday it is working with 27 regulators in 15 jurisdictions to investigate a data breach that affected millions of passengers, as Hong Kong lawmakers grilled executives over how it handled the incident.

The executives did not answer repeated questions about whether the airline would compensate all affected customers or if it might face a hefty fine under new European Union privacy regulations, saying it was “too early” to comment.

Cathay has come under mounting criticism after it said late last month that about 9.4 million passengers’ personal data had been accessed without authorization, seven months after it became aware of the breach.

It was not immediately clear who was behind the breach or what the information might be used for, but Cathay said there was no evidence so far that personal information had been misused.

“The incident is a crisis,” company Chairman John Slosar told the committee. “It is the most serious one the airline has faced.”

Slosar again apologized for failing to protect customers’ data and said he regretted that the company could not investigate the attack more quickly.

Shares of Cathay, which slid to a nine-year low after news of the data leak last month, were up more than 4 percent on Wednesday, beating a flat broader market .HSI.

Cathay said in a document submitted to Hong Kong’s Legislative Council that it first detected suspicious activity on its network in March and that the attack continued in the following months and expanded in scope.

The airline then took until mid-August to conclude which passenger data had been accessed, according to the document, and it completed the identification of the personal data that pertained to each individual passenger on Oct. 24.

Slosar said that in future Cathay would instantly disclose any similar issues to the authorities.

The company denied the data breach was a result of layoffs at its IT department last year.

Cathay said an airline restructuring had been completed and it planned to hire 1,800 staff this year.

It also said it has spent over HK$1 billion ($127.7 million) on IT infrastructure and security over the past three years.

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Oil extends slide from 7 percent slump the day before as outlook darkens

SINGAPORE (Reuters) – Oil markets slipped again on Wednesday, extending losses from a 7 percent plunge the previous session as surging supply and the specter of faltering demand scared off investors.

U.S. West Texas Intermediate (WTI) crude oil futures were at $55.50 per barrel at 0514 GMT, down 19 cents from their last settlement.

International benchmark Brent crude oil futures LCOc1 were down 22 cents at $65.25 per barrel.

Crude oil has lost over a quarter of its value since early October in what has become one of the biggest declines since prices collapsed in 2014.

The slump in spot prices has turned the entire forward curve for crude oil upside down.

Spot prices in September were significantly higher than those for later delivery, a structure known as backwardation that implies a tight market as it is unattractive to put oil into storage.

By mid-November, the curve had flipped into contango, when crude prices for immediate delivery are cheaper than those for later dispatch. That implies an oversupplied market as it makes it attractive to store oil for later sale.

Oil markets are being pressured from two sides: a surge in supply and increasing concerns about an economic slowdown.

U.S. crude oil output from its seven major shale basins is expected to hit a record of 7.94 million barrels per day (bpd) in December, the U.S. Department of Energy’s Energy Information Administration (EIA) said on Tuesday.

That surge in onshore output has helped overall U.S. crude production C-OUT-T-EIA hit a record 11.6 million bpd, making the United States the world’s biggest oil producer ahead of Russia and Saudi Arabia.

Most analysts expect U.S. output to climb above 12 million bpd within the first half of 2019.

“This will, in our view, cap any upside above $85 per barrel (for oil prices),” said Jon Andersson, head of commodities at Vontobel Asset Management.

The surge in U.S. production is contributing to rising stockpiles.

U.S. crude stocks climbed by 7.8 million barrels in the week ending Nov. 2 to 432 million as refineries cut output, data from industry group the American Petroleum Institute showed on Tuesday.

The producer cartel of the Organization of the Petroleum Exporting Countries (OPEC) has been watching the jump in supply and price slump with concern.

OPEC has been making increasingly frequent public statements that it would start withholding crude in 2019 to tighten supply and prop up prices.

“OPEC and Russia are under pressure to reduce current production levels, which is a decision that we expect to be taken at the next OPEC meeting on Dec. 6,” said Andersson.

That puts OPEC on a collision course with U.S. President Donald Trump, who publicly supports low oil prices and who has called on OPEC not to cut production.

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China industrial output, investment beat forecasts; retail sales miss

BEIJING (Reuters) – China reported a mixed bag of economic data for October on Wednesday, but industrial output and investment grew faster than expected, suggesting a flurry of support measures may be starting to take hold.

Other indicators pointed to continued pressure on the economy, however.

Retail sales slowed more than expected, while growth in October real estate investment eased to a 10-month low and home sales fell again as developers held back expansion plans in the face of softening demand.

Facing the weakest growth since the global financial crisis, Chinese policymakers are fast-tracking road and rail projects, pushing banks to increase lending and cutting taxes to ease strains on businesses and prevent a sharper slowdown.

Industrial output rose 5.9 percent in October, the National Bureau of Statistics (NBS) said on Wednesday, surpassing analysts’ estimates. Factory output had been expected to grow 5.7 percent, down from 5.8 percent in September.

(China’s economic trends: tmsnrt.rs/2iO9Q6a)

China’s economy is facing increasing domestic and external pressures, with a multi-year regulatory crackdown on riskier lending discouraging investment and U.S. tariffs threatening its export machine.

While China’s exports to the United States have been surprisingly resilient so far, analysts warn they could fall sharply next year after the U.S. imposes much higher duty levels starting in January. Business surveys show factory export orders – an indicator of future activity – have been shrinking for months.

China’s fixed-asset investment growth quickened to 5.7 percent in the January-October period.

Analysts polled by Reuters had expected it to rise 5.5 percent in the first 10 months of the year, edging up from 5.4 percent in January-September.

Investment growth had fallen to a record low earlier in the year as regulators reined in local government spending and debt.

Private sector fixed-asset investment rose 8.8 percent in January-October, compared with an increase of 8.7 percent in the first three quarters. Private investment accounts for about 60 percent of overall investment in China.

Growth in infrastructure spending, a powerful economic driver last year, picked up to 3.7 percent in the first 10 months of the year, compared with a rise of 3.3 percent in January-September.

Beijing has been fast-tracking approvals for fixed-asset investments in recent months. The state planner gave the greenlight to 45 projects worth 437.4 billion yuan in the third quarter, accounting for nearly two-thirds of the value of approvals so far this year.

China’s State Council, or cabinet, recently said the country would ramp up investment in infrastructure such as railways, highways and airports to spur domestic demand.

Government spending rose 8.2 percent in October from a year earlier.

But even if the projects get funding swiftly, economists note it will be some time before the new spending works its way through the economy and growth starts to stabilize.

Retail sales rose 8.6 percent in October from a year earlier, the slowest since May. Analysts had expected retail sales to rise 9.1 percent, slowing from 9.2 percent in September.

Loss of economic growth momentum has in recent months fanned concerns that China is seeing a consumption slowdown.

China’s automobile sales fell 11.7 percent in October, bringing the world’s biggest car market closer to its first annual contraction since at least 1990.

Beijing released a draft plan for personal income tax deductions in late October as part of efforts to boost domestic consumption, and Reuters was told recently that more tax cuts are being planned.

Chinese e-commerce giant Alibaba Group Holding Ltd (BABA.N) reported a record 213.5 billion yuan ($30.70 billion) in sales on Sunday from China’s Singles’ Day – an annual 24-hour buying frenzy that exceeds the combined sales for Black Friday and Cyber Monday in the United States.

But the pace of growth dropped to its slowest rate in the event’s 10-year history.

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Oil struggles to find footing after 7 percent slump, sentiment stays weak

SINGAPORE (Reuters) – Oil markets struggled to find their footing on Wednesday after plunging by 7 percent the previous session, with surging supply and the specter of faltering demand keeping investors on edge.

U.S. West Texas Intermediate (WTI) crude oil futures were at $55.54 per barrel at 0159 GMT, down 15 cents from their last settlement.

International benchmark Brent crude oil futures LCOc1 were up 4 cents at $65.51 per barrel.

Markets fell by more than 7 percent the previous day. Crude oil has lost over a quarter of its value since early October in what has become one of the biggest declines since prices collapsed in 2014.

The slump in spot prices has turned the entire forward curve for crude oil upside down.

Spot prices in September were significantly higher than those for later delivery, a structure known as backwardation that implies a tight market as it is unattractive to put oil into storage.

By mid-November, the curve had flipped into contango, when crude prices for immediate delivery are cheaper than those for later dispatch. That implies an oversupplied market as it makes it attractive to store oil for later sale.

Oil markets are being pressured from two sides: a surge in supply and increasing concerns about an economic slowdown.

U.S. crude oil output from its seven major shale basins is expected to hit a record of 7.94 million barrels per day (bpd) in December, the U.S. Department of Energy’s Energy Information Administration (EIA) said on Tuesday.

That surge in onshore output has helped overall U.S. crude production C-OUT-T-EIA hit a record 11.6 million bpd, making the United States the world’s biggest oil producer ahead of Russia and Saudi Arabia.

Most analysts expect U.S. output to climb above 12 million bpd within the first half of 2019.

“This will, in our view, cap any upside above $85 per barrel (for oil prices),” said Jon Andersson, head of commodities at Vontobel Asset Management.

The surge in U.S. production is contributing to rising stockpiles.

U.S. crude stocks climbed by 7.8 million barrels in the week ending Nov. 2 to 432 million as refineries cut output, data from industry group the American Petroleum Institute showed on Tuesday.

The producer cartel of the Organization of the Petroleum Exporting Countries (OPEC) has been watching the jump in supply and price slump with concern.

OPEC has been making increasingly frequent public statements that it would start withholding crude in 2019 to tighten supply and prop up prices.

“OPEC and Russia are under pressure to reduce current production levels, which is a decision that we expect to be taken at the next OPEC meeting on Dec. 6,” said Andersson.

That puts OPEC on a collision course with U.S. President Donald Trump, who publicly supports low oil prices and who has called on OPEC not to cut production.

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Hard sell for May on soft Brexit deal

British Prime Minister Theresa May stands accused of surrender by elements of her own party over a Brexit deal that ensures there will not be a hard Border in Ireland.

he agreement reached between Britain and EU negotiators includes a so-called ‘backstop’ which will keep Northern Ireland tightly locked to European trade rules “unless and until” another means of frictionless trade is found.

However, the Government remains extremely nervous that Mrs May will not be able to win enough votes for the proposal in Westminster.

In a strong indication the DUP will vote against the deal, party leader Arlene Foster said they would oppose “a deal which weakens the Union”. Taoiseach Leo Varadkar ordered an effective media blackout from his ministers on the deal. Sources said the Government is “content” with the package.

The Irish Independent understands the British side “categorically conceded” it will not be able to leave the arrangement without EU approval.

But as Mrs May sought support from her cabinet, opponents said Britain was being turned into a “vassal state”.

Brexiteer former foreign secretary Boris Johnson and Conservative MP Jacob Rees-Mogg claimed Dublin will now have more influence over Northern  Ireland than London.

Mr Johnson said: “We will not have protected our precious union. For the first time since partition, Dublin would have more say in some aspects of the government of Northern Ireland than London.”

Mr Rees-Mogg claimed: “White flags have gone up all over Whitehall. It is a betrayal of the union.”

All eyes will now turn to the Democratic Unionist Party (DUP), whose 10 MPs prop up Mrs May’s minority government.

In a strong indication that the DUP will vote against the deal, party leader Arlene Foster said that without an exit clause the UK “would be handcuffed to the European Union with Brussels holding the keys”.

She said the DUP would oppose “a deal which weakens the union”.

Ms Foster said it would be “democratically unacceptable for Northern Ireland trade rules to be set by Brussels”.

Under the agreed text, the whole of the UK will enter a temporary customs arrangement. However, at its “core” will be specific provisions for Northern Ireland which will keep the region more tightly aligned to the rules of the EU single market.

It is understood a review of UK-EU relations will take place six months before the end of the transition period in December 2020. This will determine whether the UK is ready to move to a free trade deal, transfer to the backstop or extend the transition.

In the Dáil yesterday, Mr Varadkar said the language around the customs arrangement was not important so long as the Irish objectives were achieved.

“Whether it is a double backstop, a backstop to a backstop or a hybrid backstop is not the point. The point is having a legally binding guarantee that a hard Border would not emerge between Northern Ireland and Ireland,” he said.

Defending his acceptance of a review mechanism, Mr Varadkar noted that the Good Friday Agreement has one.

“Part of the understanding behind the Good Friday Agreement was that if one wanted it to be long-standing and enduring, it made sense to build into it review mechanisms.

“If we are going to have an agreement between the UK and the EU, one has to be willing to be generous on occasion and give them something, so long as one maintains one’s objectives and outcomes,” he said.

A string of diplomatic meetings are now being lined up to take place if Mrs May survives her cabinet meeting at 2pm today.

A meeting of the Irish Cabinet has been called for 9.30am “to consider developments”.

Mr Varadkar’s spokesman said last night: “The Irish Government wants to allow the British government to have time and space to consider the draft agreements.”

EU ambassadors are also expected to be talked through the plan by chief negotiator Michel Barnier in Brussels this evening. At that point they will begin planning for a special summit of EU leaders on Sunday, November 25.

Sources told the Irish Independent that this is a “best-case scenario, but everything depends on how it goes down in London”. The reaction from other EU capitals is also being closely watched by Irish and EU officials.

There are concerns that allowing the UK to remain in a customs arrangement could give them an unfair trading advantage unless they stick by EU environmental, labour and State aid rules.

Irish sources are confident the solidarity shown by the EU27 since the referendum in June 2016 will be maintained.

In a bid to get her cabinet on side, Mrs May will warn that many of the UK’s contingencies for a ‘no-deal’ Brexit will have to kick-in on December 1 if the Withdrawal Agreement is rejected.

“Cabinet will have to decide within the next few weeks whether no-deal is to be its main planning scenario for exit,” a UK official said.

Then to get a deal through the UK parliament, the prime minister needs the votes of about 320 out of 650 MPs.

She will turn to the Labour Party in the hope that some opposition MPs will back her position rather than see the country crash out of the EU.

Officially, Jeremy Corybn’s party has said it will oppose any agreement that does not retain “the exact same” economic benefits that it now has with the EU.

Amid the flurry of activity yesterday, the EU Commission published details of its plans for a no-deal scenario.

It noted that Brexit will affect members “to varying degrees, but none more so than Ireland”.

“The Commission stands ready to support Ireland to find solutions addressing the particular challenges,” it said.

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Asia stocks shaken by plunge in crude oil, growth worries

TOKYO (Reuters) – Asian shares edged lower as investors fretted about slowing global growth with crude oil prices sinking on worries about weakening world demand and oversupply.

U.S. crude futures dived 7 percent the previous day, suffering their biggest one-day loss in more than three years. The contracts last stood at $55.72 per barrel CLc1 following a descent to $54.75 overnight, their lowest since November 2017.

OPEC warned on Tuesday that a supply glut could emerge in 2019 as the world economy slows and rivals increase production more quickly than expected.

The concerns about global growth pushed MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS down 0.07 percent.

Australian stocks fell 0.5 percent, South Korea’s KOSPI .KS11 lost 0.2 percent and Japan’s Nikkei .N225 added 0.3 percent.

The Dow .DJI and S&P 500 .SPX ended slightly lower on Tuesday as lower oil prices took a toll on energy shares, offsetting a small gain in technology stocks and renewed hopes for progress in U.S.-China trade talks. [.N]

The Nasdaq .IXIC managed to end essentially flat on Tuesday as a rebound in technology stocks kept the index out of negative territory.

Riskier assets have been under intense selling pressure over the past two months as worries about a peak in earnings growth added to international trade tensions and signs of slowing in global investment and growth.

“The markets would have reacted more positively to U.S.-China trade and Brexit-related headlines a few months ago,” said Makoto Noji, chief currency and foreign bond strategist at SMBC Nikko Securities in Tokyo.

“But currently there is more focus on the possibility of both the U.S. and Chinese leaders maintaining their tough stance, with a compromise eluding them, and Brexit bogging down. Market sentiment is clearly cooling down.”

The United Kingdom and European Union agreed on the text for a Brexit divorce deal on Tuesday. Prime Minister Theresa May will present the draft withdrawal agreement to her senior ministers on Wednesday for discussion and then decide on the next steps.

Lifted by the latest hopes for a Brexit deal, the pound extended overnight gains and was last 0.35 percent higher at $1.3016 GBP=D4.

Brexit hopes also supported the euro. The single currency was up 0.2 percent at $1.1310 EUR=, pulling back from a 17-month trough of $1.1216 brushed on Monday.

The euro’s gains, however, were tempered by concerns over Italy’s budget proposals. The European Commission rejected Italy’s plan last month and has threatened to impose penalties if it is not revised to conform with EU regulations – something Rome has indicated it is unwilling to do.

The dollar index .DXY, which measures the greenback’s strength against six major currencies, slipped overnight to 97.303.

The index had steadily climbed to a 16-month peak of 97.693 on Monday amid the ongoing U.S.-China trade dispute and the Federal Reserve’s commitment to keep gradually raising interest rates.

Also weighing on the dollar, U.S. Treasury yields slid to more than one-week lows overnight as the sharp drop in oil prices suggested a more subdued inflation outlook. [US/]

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