MercoPress. South Atlantic News Agency

UK pound down on fears of Johnson PM and a no deal exit from the EU

The result of UK's weeks-long internal party election will be announced Tuesday. The winner be it Johnson or Hunt will become prime minister on Wednesday.

Expectations of policy easing by major central banks such as the Federal Reserve propped up global stocks on Tuesday, while the pound sagged as Britain braced for a new prime minister who could pave the way for a no-deal exit from the European Union.

MSCI's broadest index of Asia-Pacific shares outside Japan inched up 0.02per cent.

Japan's Nikkei rose 0.25per cent. Australian stocks added 0.15per cent and South Korea's KOSPI gained 0.2per cent.

The S&P 500 edged up toward a record high overnight, supported by expectations that the Federal Reserve would cut interest rates at its July 30-31 policy meeting.

European stocks had also nudged higher on Monday with the European Central Bank seen cutting rates by 10 basis points on Thursday.

But with central bank easing no longer a fresh theme, market gains were limited.

In currency markets, the pound was a touch lower at US$1.2477 and headed for its third session of losses.

Sterling was under pressure due to the likelihood of euro skeptic Boris Johnson becoming Britain's next prime minister.

The result of Britain's weeks-long internal party election will be announced on Tuesday, with Johnson widely expected to have beaten foreign minister Jeremy Hunt. The winner will become prime minister on Wednesday.

Some investors are worried Johnson could pull Britain out of the European Union on Oct. 31 without a trade deal in place in order to appease members of his Conservative Party.