British prime minister Boris Johnson faces an uphill task in getting his Brexit deal past lawmakers

London (AFP) - Sterling steadied around $1.29 Friday as dealers paused for breath at the end of a dizzying week and on the eve of a vital vote on Prime Minister Boris Johnson’s Brexit deal.

The stage is now set for the House of Commons, which will meet for the first time on a Saturday in 37 years for a knife-edge vote.

That will then throw the spotlight in Europe onto Sunday evening, which is when markets in Asia will deliver their first verdict on the outcome – and the potential for a chaotic Brexit on October 31.

“The market (is) really gambling on tomorrow’s vote and has not priced in fully all scenarios – so expect big moves,” warned ETX Capital analyst Michael Baker.

“On Sunday night, the markets will start opening from the Far East … and it could be a hugely volatile open, regardless of the outcome,” he warned.

- Rollercoaster trade -

In rollercoaster deals, the pound had rallied Thursday to almost $1.30 on news that negotiators had hammered out an agreement that would avoid Britain leaving the EU without a divorce deal – a move many commentators warn could be economically catastrophic.

However, sterling then sank under $1.29 as it became evident that Johnson faced an uphill task in getting the deal past lawmakers, with opposition MPs and some in his own Conservative party saying they were against it.

Most importantly, Northern Ireland’s Democratic Unionist Party (DUP), which props up Johnson’s government, said it was “unable” to back him.

Britain voted in June 2016 to leave the European Union but it has delayed its departure date twice so far this year after lawmakers rejected previous Brexit deals.

“Based on everything that has happened over the last three years, it is hard to think that it will pass and then Brexit is on the road to completion,” mulled Baker.

- Renault sounds alarm -

In non-Brexit news, Europe’s car sector hit the skids on Friday after French auto giant Renault sounded the alarm over its sales outlook.

Renault shares crashed 12 percent to 48.38 euros in Paris after warning that 2019 revenues would be three to four percent lower than last year – and blamed “less favourable than anticipated” conditions.

“Renault shares slumped today after the company lowered its full-year revenue plus profit guidance,” said CMC Markets analyst David Madden.

“The news sent the stock to its lowest level since 2013, plus it weighed on Daimler, Fiat Chrysler in addition to Volkswagen.”

In Frankfurt, Volkswagen stock dropped one percent and Daimler shed 0.8 percent, while Fiat Chrysler was down 1.5 percent in Milan.

- Sharp Chinese slowdown -

Elsewhere, Asian stocks mostly fell Friday with Shanghai diving 1.3 percent, as data showed China’s economy expanded at its slowest pace in nearly three decades.

China said its economy expanded six percent in the third quarter – marking the slowest pace in 27 years – as leaders struggle to address weak domestic demand and the long-running US trade war.

The reading was a drop from the previous three months but in line with an AFP forecast and the government’s 6.0-6.5 percent target for the year.

Hong Kong was off 0.5 percent amid concern over the possibility of more violent protests over the weekend.

- Key figures around 1045 GMT -

Pound/dollar: UP at $1.2900 from $1.2891 at 2100 GMT

Euro/pound: DOWN at 86.32 pence from 86.29 pence

Euro/dollar: UP at $1.1133 from $1.1125

Dollar/yen: DOWN at 108.57 yen from 108.66 yen

London - FTSE 100: DOWN 0.2 percent at 7,169.68 points

Paris - CAC 40: DOWN 0.3 percent at 5,657.46

Frankfurt - DAX 30: UP 0.2 percent at 12,684.42

EURO STOXX 50: UP 0.1 percent at 3,591

Tokyo - Nikkei 225: UP 0.2 percent at 22,492.68 (close)

Hong Kong - Hang Seng: DOWN 0.5 percent at 26,719.58 (close)

Shanghai - Composite: DOWN 1.3 percent at 2,938.14 (close)

New York - Dow: UP 0.1 percent at 27,025.88 (close)

Brent North Sea crude: UP 0.2 percent at $60.02 per barrel

West Texas Intermediate: UP 0.5 percent at $54.31