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HSBC pays, Brexit: Near the Finish line?

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Market Roundup

European markets finished a day of trading in the green as investors remained focused on the unfolding budget crisis in Italy. The country’s Deputy Prime Minister Matteo Salvini described President of the European Commission Jean-Claude Juncker and European Commissioner for Economic and Financial Affairs Pierre Moscovici as "the real enemies of Europe" after the two officials criticized Rome’s new budget plans.

In Germany, the DAX closed 0.31% higher, led by Wirecard stocks as they were up 9.57%. Wirecard shares shoot up after the firm forecasted a steep growth over the next ten years. French CAC 40 added 0.47% at the end of the trading session. Air France-KLM was among the main advancers, up 5.31%. London’s FTSE 100 rose 0.11% at the close.

HSBC in US to pay over mortgage misconduct

HSBC North America Holdings Inc. reached an agreement with the United States Department of Justice (DoJ) to pay $765 million in settlement following an investigation into the bank’s practices regarding residential mortgage-backed securities (RMBS) ahead of the 2008 financial crisis. The bank added it agreed to pay the DoJ the penalty without admitting liability or wrongdoing.

"Since the financial crisis, HSBC has been strengthening our culture, processes and internal controls to ensure fair outcomes for our clients. The US management team is focused on putting historical matters into the rear view mirror and completing the turn-around of HSBC’s US operations," HSBC CEO Patrick Burke stated.

The settlement follows a several-years-long probe into the bank’s mortgage practices. HSBC already paid fines in 2013 and 2016 related to similar allegations in the US.

Brexit deal expected next week

The United Kingdom and the European Union are close to reaching a deal on most of the terms of Britain’s departure from the bloc and the agreement could be announced as soon as next Monday.

According to some reports, the UK and the EU are set to define their post-Brexit relationship in all areas except trade next week, with the trade agreement expected in November. It seems that the two sides have narrowed their disagreements regarding the Irish border issue but there are still some differences on the matter.

Earlier in the day, Downing Street insisted the UK will not accept any Brexit agreement which does not include a precise framework for a future relationship between London and Brussels. Meanwhile, Democratic Unionist Party (DUP) leader Arlene Foster said her party would never accept customs checks in the Irish Sea for goods coming into Northern Ireland from the rest of the UK.

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