View all newsletters
Sign up to our newsletters

Support 110 years of independent journalism.

  1. Politics
  2. Brexit
24 June 2016

Brexit sends FTSE 100 into freefall amid recession fears

The market volatility caused by a Brexit could last for years.

By Julia Rampen

Just 12 hours ago, the Remain campaign was feeling quietly confident, and the markets even more so. After weeks of the pound tumbling, and the FTSE100 drifting downwards, suddenly there was an upsurge.

But after Britain voted to leave the European Union, the UK’s leading stock index has immediately plunged 8.3%, and the pound is in freefall.

The nosedive from 6334 points last night to 5807 today means billions has been knocked off the value of the stock market in hours.

The Bank of England said it is monitoring the situation closely. 

House builder companies are among the most badly hit, which suggests investors are nervous about house prices. 

Select and enter your email address Your weekly guide to the best writing on ideas, politics, books and culture every Saturday. The best way to sign up for The Saturday Read is via saturdayread.substack.com The New Statesman's quick and essential guide to the news and politics of the day. The best way to sign up for Morning Call is via morningcall.substack.com Our Thursday ideas newsletter, delving into philosophy, criticism, and intellectual history. The best way to sign up for The Salvo is via thesalvo.substack.com Stay up to date with NS events, subscription offers & updates. Weekly analysis of the shift to a new economy from the New Statesman's Spotlight on Policy team. The best way to sign up for The Green Transition is via spotlightonpolicy.substack.com
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
THANK YOU

Now the pound is at its lowest level against the dollar since 1985, and the Asian markets nosedived. 

Financial insiders are already predicting a recession and a market shock that could last for years.

Piers Hillier, chief investment officer at Royal London Asset Management, said: “On the back of this morning’s result we expect the UK will fall into a recession. Unfortunately I see unstable market conditions lasting for between three and five years whilst new trade agreements are drawn up.

“It is our view that the UK Government will be left with no choice but to stimulate the economy through fiscal and monetary means, flooding the system with liquidity if necessary.”

The FT has reported that credit ratings agency S&P expects the UK to lose its last AAA rating – previously a sign of the nation’s creditworthiness.

The pound plummeted from $1.4877 to the pound last night to $1.3445 this morning. In other words, if you’d exchanged £1,000 for dollars last night, you’d have $143.20 more than if you did it now. 

Nigel Green, founder and CEO of financial services group deVere said it was a “shock event”.

He continued: “Brexit-triggered volatility is now only just beginning; we can expect it to potentially last up to two years.  
 
“Due the far-reaching impact of this vote, Brexit will inevitably affect the British and the European economies and the wider global financial markets.  The decision may have been taken in the UK but it will impact the rest of the world too.”

Content from our partners
Delivering for the forgotten majority – how Labour can increase NHS capacity
Future proofing the NHS
Where do we get the money to fix the world's biggest problems? – with ONE

Select and enter your email address Your weekly guide to the best writing on ideas, politics, books and culture every Saturday. The best way to sign up for The Saturday Read is via saturdayread.substack.com The New Statesman's quick and essential guide to the news and politics of the day. The best way to sign up for Morning Call is via morningcall.substack.com Our Thursday ideas newsletter, delving into philosophy, criticism, and intellectual history. The best way to sign up for The Salvo is via thesalvo.substack.com Stay up to date with NS events, subscription offers & updates. Weekly analysis of the shift to a new economy from the New Statesman's Spotlight on Policy team. The best way to sign up for The Green Transition is via spotlightonpolicy.substack.com
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
THANK YOU