Following the Leave vote, stock markets fell.

Brexit Rocks Markets: Stocks Plummet, Pound Dives, Central Banks Step In

• Markets React: Wall Street and the FTSE 100 saw significant declines after the UK’s Brexit decision.
• FTSE 100’s Rollercoaster: The London blue-chip index initially dropped 7% to around 5,800 points but ended the day 3.15% lower at 6,138.
• Global Markets Affected: New York and European markets experienced even larger falls, with the Dow Jones recording its largest one-day slide in nearly five years.
• Pound Takes a Hit: Sterling also plummeted, losing over 8% against the dollar and 6% against the euro.
• Moody’s Downgrade: Credit rating agency Moody’s downgraded the UK’s outlook from stable to negative, citing potential weaker economic growth.
• Wall Street Tumbles: Wall Street saw a sharp decline, with the Dow falling over 600 points (3.4%) to close at 17,400 points.
• Market Volatility: The S&P 500 dropped 3.6%, marking its most significant daily slide in 10 months, while the Nasdaq sank 4.1%.
• Market Shock: Jack Ablin, Chief Investment Officer of BMO Private Bank, noted that global investors were caught off guard by the Brexit result.
• FTSE 250 Declines: In London, the FTSE 250, primarily comprising UK-based firms, shed 7.2% to close at 16,088 points.
• Housebuilders Hit Hard: Housebuilders were among the top losers on both the FTSE 100 and FTSE 250, facing significant declines.
• FTSE 100’s Recovery: However, the FTSE 100 index ended the week higher than its starting point at 6,021 points.
• Mixed Market Reaction: Some companies, including gold miner Randgold and consumer-facing firms, rose more than 3%.
• Central Bank Support: The Bank of England pledged £250 billion to support the markets, acknowledging the potential for volatility during the process.
• Market Bargains: Bargain hunters helped the blue-chip index recover later in the day, favoring companies with substantial overseas earnings.
• Sterling’s Volatility: Sterling fell more than 10% early on Friday but later regained some ground.
• Market Impact: UK government bond yields reached new record lows, while oil prices fell sharply, and gold prices surged.
• European Markets Hit: The Brexit shock extended across Europe, affecting markets in Frankfurt, Paris, Milan, and Madrid.
• Sector-Specific Reactions: Airlines, UK banks, and European banks faced significant stock declines, with some anticipating a weaker UK economy.
• Market Uncertainty: Analysts expect increased economic uncertainty and anticipate central banks taking action to mitigate Brexit’s effects.