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European stock markets rally on Brexit deal, Italy budget hopes

European stock markets rallied Monday after Britain sealed a Brexit deal with the EU and as Italy said it could cut its budget deficit.

European stock markets rally on Brexit deal, Italy budget hopes
Italy's Prime Minister Giuseppe Conte arrives at a special meeting of the European Council to endorse the draft Brexit withdrawal agreement in Brussels on November 25, 2018. Photo: Philippe Lopez / AF

The euro rose against the dollar but was down versus sterling.

Oil prices rebounded meanwhile, after slumping Friday to the lowest levels in more than one year.

Bitcoin extended its slide, dropping under $4,000 to $3,675.44 — the lowest level for 14 months.

“Italian stocks have been the outperformer in Europe… on reports that the government may consider reducing its deficit target in a bid to avert a disciplinary procedure in Brussels and a backlash in the markets,” noted Craig Erlam, senior market analyst at Oanda trading group.

“The pound is also a little higher… after (British Prime Minister) Theresa May overcame the first, and smallest, hurdle to her Brexit deal getting over the line.”

May convened her cabinet and will update Britain's parliament on the newly-agreed Brexit deal Monday, as she begins the tricky task of selling the plan to her sceptical country.

In Rome, Italy's populist government appears open to reducing its draft budget deficit, fuelling  a surge in the Milan stock market on hopes Rome could ease a stand-off with EU officials in Brussels.

Around 1430 GMT, Milan's FTSE MIB was up 2.5 percent compared with the close on Friday. London's FTSE 100 gained 0.8 percent.

Most Asian stock markets closed higher as investors tentatively picked up cheap stocks, with focus on an expected meeting between US President Donald Trump and his Chinese counterpart Xi Jinping at the weekend that will be watched for signs of a softening in the China-US trade war.

Those gains came despite more selling of shares in Asian energy firms following another collapse in oil prices Friday.

Wall Street also pushed higher at the opening bell, with the Dow climbing 0.6 percent.

The more positive mood comes at the start of a week set to include a speech by Federal Reserve boss Jerome Powell and the release of the bank's last policy meeting minutes, before culminating in a G20 gathering in Buenos Aires.

While the summit will focus on several global issues, the meeting between Trump and Xi will get the most attention, with the economic superpowers engaged in a trade war just as global growth starts to stutter.

Expectations for a deal to end the standoff are low, however.

Oil prices enjoyed a bounce but remain well beaten down after Friday's hammering, which saw WTI sink 7.7 percent and Brent lose more than six percent.

The commodity has plunged by about a third in value from four-year highs in early October owing to a range of issues, including a global economic slowdown, the trade row, rising crude supplies, softer-than-expected US sanctions on Iran, stuttering business activity in China and a stronger dollar.

All eyes are now on a meeting of the Organization of the Petroleum Exporting Countries on December 6 to see if the cartel will cut output.

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‘So stressful’: How Italy-UK driving licence fiasco threatens couple’s Tuscan dream

One couple from Manchester found the home of their Tuscan retirement dreams, but the stalemate over a UK-Italy driving licence agreement is throwing their future into question.

'So stressful': How Italy-UK driving licence fiasco threatens couple's Tuscan dream

Iain and Lynn Gosling lived and worked all their lives in and around Manchester – at a bank, where they met, then in various schools – but had always dreamed of retiring in Tuscany.

In 2018, with the Brexit clock ticking, they decided to take the plunge, and after a lengthy Place in the Sun-style hunt, they finally found their ideal home.

The podere (farmhouse) they chose just outside the town of Pomerance, in the province of Pisa, checked all their boxes: it had an olive grove, was close enough to the beach, had a friendly local community, and the town was particularly invested in green energy, sourcing most of its power from renewables.

Most importantly, it was just over an hour’s drive from Pisa airport, meaning they could regularly go back and visit family in the UK.

READ ALSO: ‘We bought the cheapest house in Piedmont and live mortgage free’

“We’d holidayed in Tuscany for 20 years, and the views and everything were even better than where we’d been holidaying. So we kind of thought we struck gold really,” says Lynn.

“When we saw it, we just knew, and when we went into the town it was such a good, welcoming feeling.”

Iain and Lynn's podere in Pomerance.

Iain and Lynn’s podere in Pomerance. Source: Iain Gosling.

The couple began building a new life, learning Italian and befriending local residents. They were careful to take the necessary steps to secure their future in Italy before the Brexit deadline, registering with the town hall and later obtaining carta di soggiorno residency cards.

But – like many other British nationals in Italy – the pair didn’t anticipate that almost two years on from Brexit, negotiations for a reciprocal driving licence agreement between the two countries would have stalled. It’s an ongoing state of limbo that threatens to make their retirement dream unworkable.

While with hindsight the pair would have exchanged their driving licences before the Brexit deadline, they believed a deal would soon be reached – especially as the UK allows EU licence-holders to drive with almost no restrictions.

“If we cannot drive in the short term, I’m sure we can find a way round it somehow,” says Iain. “Longer term? No, not really.”

READ ALSO: Do you have to take Italy’s driving test in Italian?

A 12-month grace period granted in 2021 is due to expire in January unless an agreement is reached, forcing UK drivers to choose between taking an Italian driving exam that could well turn out to be unnecessary, or gambling on a last-minute deal that risks leaving them without a valid licence if it doesn’t materialise.

For Iain and Lynn, who live a four-minute drive from the town on hilly country roads without access to public transport or pavements, it doesn’t feel like much of a choice.

“I’d be absolutely lost without driving,” says Lynn, who judges that without a car the couple would have to make daily hour-long round walks into town to buy basic necessities.

They decided that Iain would take the exam so that at least one of them would still be able to drive in the absence of a deal, and booked his theory test for November to give him time to prepare.

As a minimum of 32 days must pass between passing the theory test and sitting the practical exam, he’ll only just secure his Italian licence in time in the event that there’s no agreement – if he manages to pass both on the first go.

READ ALSO: Some of the best learner sites for taking your Italian driving test

Iain and Lynn outside their Tuscan farmhouse.

Iain and Lynn outside their Tuscan farmhouse. Source: Iain Gosling.

“So – no pressure on the theory test,” says Iain, who plans to fly back early from Christmas holidays in the UK to sit his practical exam if he succeeds in passing the former.

The couple know they could have begun the process earlier. But the test requires answering the same theory questions as a native Italian speaker and a taking mandatory six hours of practical lessons, and it isn’t cheap – Iain and Lynn estimate the total cost to be just under €1,000.

What’s more, those who pass an Italian driving test are classed as new drivers (neopatentati) for three years, which comes with a range of restrictions on speed limits and vehicle engine size, and a zero tolerance policy on alcohol.

READ ALSO: Driving licences: Are the UK and Italy any closer to reaching an agreement?

All this has made taking the test a last resort for people who believed the UK and Italian governments would have reached an agreement by this point – or have at least issued clear guidance as to what action UK licence-holders should take.

The UK’s ambassador to Italy stresses that negotiations continue – though has encouraged British residents to book an Italian driving test.

A spokesperson for the British Embassy in Rome told The Local in October: “Since August we have continued and intensified further our work with our Italian colleagues and have made progress towards our shared objective.”

Lynn says: “Over the last six months it was very optimistic, everything we were hearing. It’s just in the past two months that we’ve thought, well, wait a minute.”

If Iain doesn’t manage to pass the test before the deadline and no deal is reached, “we are stuck,” he says.

“This situation is so stressful.”

READ ALSO: How UK drivers in Italy face new problems after passing Italian driving test

The couple fear that without the ability to drive, their current lifestyle would be unsustainable.

“You wake up thinking about it, and you go to bed thinking about it,” says Lynn. “Anxiety, that’s how it makes you feel.”

“Someone will turn around and say, well why didn’t you take your driving tests 12 months ago so you’re not in this situation?” says Iain. “But if all the signs were encouraging from the ambassador, we thought well OK, we can keep our benefits here and we don’t want to lose them.”

While the embassy insists that negotiating the agreement is its top priority, Iain worries that the recent political upheaval in both the UK and Italy has pushed the issue on to the back burner.

“We have no choice but to have faith in our British representatives to deliver and soon too, because the previous regulation extension was far too late,” Iain says. “We need to know now so we can make definite plans and contingencies.”

Despite the stress, Iain and Lynn are determined to do all they can to find a way to remain in Pomerance, where they say they’ve been embraced by local residents and have become good friends with their Italian neighbours who occupy the other half of their semi-detached property.

“We don’t want to give this up,” says Iain. “We love it here and we want to stay.”

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