The FTSE 100 just erased all of its post-Brexit losses

Stocks across Europe are continued to rally on Wednesday, as investors start to fully come to terms with Britain’s vote to leave the European Union late last week.

Every single major index in Europe witnessed big dropsacross Friday and Monday, with a sea of red washing across market boards. However, some of the mild panic felt by investors in the past couple of days has now dissipated, and as a result equities across the board were higher for a second consecutive day.

At the European close, Britain’s FTSE 100 is higher by 3.7% to 6,367 points, and is now trading at a higher level than it was before the UK’s vote to leave the EU.

It should be noted that Britain’s blue-chip index is disproportionately filled with companies that denominate their assets in dollars and as a result are not hugely affected by the massive drop in the pound that has hit since the British exit from the EU, or Brexit. That means that the FTSE has outperformed its continental rivals, and does not necessarily reflect UK investor sentiment.

Here is how the FTSE looks on Wednesday:

ftse 100 june

On a stock-by-stock basis, financial stocks continued their rally, after taking an absolute pummeling on Monday, and all the UK’s biggest banks are higher. Mining stocks also benefitted on Wednesday, taking advantage of the weak pound.

At the bottom of the index, only travel company Tui was lower, hit hard by the aftermath of Tuesday’s awful terrorist attack at Istanbul airport.

The smaller cap FTSE 250 paints a more accurate picture of UK investor sentiment, as the vast majority of firms in the index are wholly UK-based. It ended the day 3.22%, but is still more than 1300 points lower than on Thursday, before the UK’s Brexit vote. Here is how the FTSE 250 looks:

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Benchmark indexes in all of Europe’s major economies are also continuing to climb on Wednesday. Here is the scoreboard:

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US stocks have also continued to rally, with the S&P 500, Dow, and Nasdaq all higher by around 1.2%-1.6% at 5:00 p.m. BST (12:00 p.m. ET).

Here is what Mike van Dulken of Accendo Markets said in an email to clients a little earlier:

Equity markets are showing no signs of looking back, maintaining their recovery uptrends from Brexit vote lows assisted by a healthy combination of a sector advances contributing to a bullish party. Financials are buoyant thanks to UK banks shares laughing at a Moody’s downgrade. Property names suggest it’s still is a seller’s market. Oil majors are enjoying the sight of oil back around $49/barrel and telecoms are up on Brexit reassurances from Vodafone.

Elsewhere in the markets, the pound has also continued to rally, gaining around 1.2% on the dollar on Wednesday to trade above $1.35. It also gained 1.14% on the Japanese yen, and around 0.8% on the euro. Here’s the pound’s performance against the dollar on the day:

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