So It Begins: Britain Kicks Off Brexit Negotiations With EU

While the Chancellor has reiterated that the United Kingdom will depart the single market and customs union when it departs the EU, he said that leaving without a deal in place would be "a very, very bad outcome for Britain".

Brexit negotiations have finally begun, with Brexit Secretary David Davis acknowledging there would be would be "challenging times ahead" as he met the European Commission's chief negotiator Michel Barnier for the formal start of the talks.

The Brussels talks began nearly a year after Britain unexpectedly voted in a referendum to leave the European Union and less than two weeks after Prime Minister Theresa May lost her overall majority in snap elections that raised questions about the stability of the government the European Union faces.

After seven hours of talks in Brussels, Mr Davis - who had previously promised the "row of the summer" over the timetable for the negotiations - said he was optimistic about the talks.

Earlier, Boris Johnson said the talks would lead to a "happy resolution" for both sides.

"We want both sides to emerge strong and prosperous, capable of projecting our shared European values, leading in the world, and demonstrating our resolve to protect the security of our citizens".

"The best way we can spend this week is to rebuild trust", rather than tackle the big hard issues right at the start, another European source said.

Those issues are the exit bill; the rights of three million European Union nationals living in Britain and the one million Britons on the continent who now are allowed to live, work and claim welfare benefits; and the status of the border between Northern Ireland and Ireland.

Earlier on Monday, Britain's negotiators arrived in Brussels to seek a "special" Brexit deal.

After the initial shock of last year's Brexit vote, the bloc at 27 appears to have steadied in recent months and got a real boost with the election of new French President Emmanuel Macron in May.

In Berlin, German Chancellor Angela Merkel emphasised the unity of the remaining 27 European Union countries, which have been alarmed in recent weeks by Prime Minister Theresa May's threats to walk out of the talks.

Anxious by immigration and loss of sovereignty, Britain voted past year to end its four-decades-old membership of the 28-country bloc - the first state ever to do so. EU leaders want May to lay off threats that she would walk out and leave a chaotic legal limbo for all Europeans.

Monday's talks, however, are likely to focus on the practical details of timings for the coming months, with the big, divisive issues left aside for now, officials said.

"My very first words are to express my deep sympathies to the British people as you face tragic events, just as I want to express our solidarity to the Portuguese people", Barnier said, before turning to welcome his British counterpart.

"In the first step, we will deal with the most pressing issues".

The letter from the British Chambers of Commerce, Confederation of British Industry, EEF, Federation of Small Businesses, and Institute of Directors, calls on the government to accept continued membership of the Single Market and Customs union until any new trade deal is signed and implemented - a process that trade experts suggest could take up to a decade.

But instead she lost her parliamentary majority, putting that hard-line approach and her political future in doubt after the disastrous June 8 election.

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