UK market still all over the place after EU Ref

28 June 2016
UK market troubled after Ref

The Brexit aftermath still rumbles on, with the UK being stripped of its AAA rating, business sectors seeing their share value dropping through the floor, and even at one point, trading in Barclays and RBS shares got suspended.

Barclays dropped 10.3% and RBS plunged by 15%, which triggered automatic circuit breakers on the London Stock Exchange.

Lloyds saw their value falling by 8.9% too.

Over in the world of airlines, easyJet issued a profit warning after their shares fell by 15%, and the parent company of British Airways - IAG - saw their value plummeting by 9.4%.

Obviously, in time, the markets will heal and investors are being told not to panic, but as this is people's money, and people's jobs, there's few people willing to be patient.

"The UK's vote to leave the EU will drive tectonic plate shifts in European bank investing. We move to a slow growth/modestly recessionary scenario for UK banks," said analysts at Jefferies.

International ratings agency Fitch were the ones to take the UK to AA from the AAA rating, saying: "Fitch believes that uncertainty following the referendum outcome will induce an abrupt slowdown in short-term GDP growth, as businesses defer investment and consider changes to the legal and regulatory environment."

"Medium-term growth will also likely be weaker due to less favourable terms for exports to the EU, lower immigration and a reduction in foreign direct investment. An adjustment in the value of sterling and changes in the business environment could also affect growth."

It's all happening. Then again, we knew this would happen didn't we? What with all those economic experts saying that this is exactly what would happen.

What happens next though?

TOPICS:   Economy

What do you think?

Connect with Facebook, Twitter, or just enter your email to sign in and comment.

Your comment