The European Union is prepared to give the U.K. an extra transition year to negotiate a trade agreement in an effort to break a stalemate in Brexit negotiations.
With an agreement still elusive, the two sides claim to be intensifying preparations in case of a disruptive no-deal U.K. departure from the bloc. However, EU Brexit negotiator Michel Barnier on Tuesday briefed foreign ministers on a plan to add a further 12 months to the transition period after Britain leaves the bloc in March 2019
European equities are in line for further gains today, with Stoxx 50 futures up 12 points, DAX futures 42 points higher and FTSE 100 futures up 26 points. Asian stock markets were sharply higher Wednesday, following even-bigger increases yesterday on Wall Street.
Watch For: UK inflation, producer prices; Theresa May travels to Brussels ahead of the EU Summit; EU national leaders discuss Brexit at working dinner; Fed publishes minutes of its last meeting.
Negotiations over Britain's departure from the European Union suffered a setback Sunday as the two sides failed to resolve differences, chiefly over how to avoid the re-emergence of a physical border in Ireland. The setback is likely to reawaken concerns of a no-deal Brexit, and raises the question of whether the two sides have the political space to solve the thorniest problems, of which the Irish border is paramount.
Germany's political fragmentation deepened after allies of Angela Merkel took a beating in a crucial regional election in Bavaria, raising questions about how long the chancellor can keep control of her brittle coalition government.