* Sterling falls vs dollar after recovery from "flash crash"
* Mexican peso, U.S. stocks futures up after Clinton-trump
* Oil falls on scepticism over output deal
* Europe shares dip after small gains on Asian bourses
* Yuan hits six-year low as China returns from holiday
By Nigel Stephenson
LONDON, Oct 10 Sterling fell again on Monday,
after largely recovering from Friday's "flash crash", while the
Mexican peso and U.S. stock futures rose as investors saw less
chance of Republican nominee Donald Trump winning next month's
The pound dropped half a percent against a dollar boosted by
expectations the Federal Reserve will raise interest rates in
December even after slightly weaker than expected jobs data on
The UK currency last stood at $1.2402, down 0.2
percent. Its trade-weighted index fell 0.7 percent to its
lowest since early 2009.
"I guess that we have to prepare for further weakness," said
Hans Redeker, head of G10 currency strategy at Morgan Stanley in
In early Asian trade on Friday, it fell 20 percent to a
three-decade low of $1.1491 in minutes as a fall on investor
concerns over Britain's impending exit from the European Union
snowballed as automated computer trades were triggered.
Britain's FTSE 100 fell 0.1 percent but outperformed
other major European stocks as the internationally-focused
companies on the index gain on overseas revenues and
competitiveness when the pound fall.
The more domestically-focused FTSE 250 index was
down 0.2 percent and British 10-year government bond yields
rose 1.3 basis points to 0.992 percent.
The pan-European STOXX 600 index fell 0.4 percent.
One of the leading fallers was Deutsche Bank, down
nearly 3 percent after Chief Executive John Cryan failed to
secure a speedy deal with the U.S. Department of Justice at the
weekend over the misselling of mortgage-backed securities.
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markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
Another notable mover on currency markets was the Mexican
peso, which at one point was up 2 percent at 18.91 to
the dollar as Trump's chances of winning the White House seemed
diminished after the second pre-election debate with Democratic
Party candidate Hillary Clinton.
Trump has vowed to build a wall on the border with Mexico
and renegotiate or scrap the North American Free Trade Agreement
(NAFTA) if he is elected, making the peso somewhat of a
barometer of his chances. The Mexican currency was last up 1.9
percent at 18.96 per dollar.
A CNN/ORC snap poll of debate watchers found that 57 percent
thought Clinton won the encounter, versus 34 percent for Trump.
U.S. stocks index futures were up about 0.2
percent, suggesting Wall Street will open higher. U.S. stock
markets are open on Monday, though the bond market is closed for
the Columbus Day holiday.
Earlier, Asian shares eked out minor gains. MSCI's broadest
index of Asia-Pacific shares outside Japan was
up 0.1 percent. Japanese markets were closed for a holiday.
Chinese shares racked up their biggest
gains in two months as investors returned from a week-long
holiday and caught up with gains on global markets.
China's yuan, however, hit a six-year low against the dollar
before recovering. The People's Bank of China set the weakest
fix for currency since September 2010 and in the spot market
fell as low as 6.7051, also its lowest since September 2010.
It last traded at 6.7025, down just 0.03 percent
on the day.
Oil prices fell, with investors sceptical an agreement among
members of the Organization of the Petroleum Exporting Countries
(OPEC) to cut output would have a major impact.
Brent crude, the international benchmark, was down 18 cents
at $51.73 a barrel.
"A meeting between OPEC and non-OPEC producers (namely
Russia) will add to oil headlines this week. Don't expect a firm
agreement from Russia, but headlines about cooperation are
likely," Morgan Stanley said.
Gold last traded at $1,263 an ounce, up 0.6 percent,
lifted by demand from returning Chinese investors.
(Additional reporting by Wayne Cole in Sydney, Henning
Gloystein in Singapore and Patrick Graham in London; Editing by