Sterling was under increasing pressure yesterday evening as British Prime Minister Theresa May was facing the prospect of a humiliating parliamentary defeat for her hard-fought Brexit deal.

The pound drooped against the dollar and also lost ground against the euro with investors on tenterhooks before the vital vote.

“The degree of political uncertainty in the UK means that economic news has been almost totally usurped,” Rabobank analyst Jane Foley said.

European stock markets, meanwhile, enjoyed cautious gains after Asia swung higher as worries dimmed over a global economic slowdown and Wall Street posted modest gains in the late New York morning.

The London FTSE-100 stock index even outperformed its eurozone peers, as equity investors welcomed a weaker pound.

With a little over two months to go until Britain leaves the EU on March 29, lawmakers were almost certain to vote against Ms May’s deal ­ ­– which was agreed with Brussels in a fraught and long-running process after the June 2016 referendum to leave the bloc.

Economic news has been almost totally usurped

Market pundits do not expect a “significant” swing following the outcome ­ ­– but they do anticipate “fireworks” as the nature of Brexit becomes apparent in the coming days, weeks and months.

“The vote is a foregone conclusion so sterling is unlikely to move significantly,” added Interactive Investor analyst Rebecca O’Keeffe.

“However, the range of possible outcomes after this crucial vote is what is far more interesting,” she said.

“From no Brexit, which could see sterling move to $1.40-plus, versus a hard Brexit which could see a move towards parity.

“The fireworks will happen after today ­– when it is clear what happens next.”

Elsewhere yesterday, Asian equity markets rebounded from the previous day’s sharp losses, with Hong Kong and Shanghai lifted by Chinese plans to slash taxes to boost the economy.

China’s disappointing trade data on Monday sent shivers through trading floors as it showed the long-running US tariffs row is beginning to bite.

But dealers resumed last week’s rally that was fuelled by optimism that Beijing and Washington will eventually resolve their differences ­– and that the US Federal Reserve will pause in raising interest rates.