It should be a night of super profits. But as some hedge funds have speculated mightily in London. There’s no telling how much money lost in this referendum night speculators. Some hedge funds had specially given secret exit polls in order to have an edge over other market participants. The reported “Financial Times”. But the forecasts of pollsters evening was wrong, because the British have opted for a withdrawal from the EU. At midnight began the nightmare. The pound, whose rise they had set, fell against the dollar from -. Minus 11.1 percent in the peak (chart above)
Many traders in the City of London had the night gone through the financial district – before their screens, black coffee tilting their orders yelling into the phone. “That’s crazy here today,” says the 34-year-old merchant David paper ETX Capital told AFP. “A massacre, a slaughter house.”
Currencies are traded unlike stocks day and night and therefore were outstandingly suitable for speculation in an election night. The euro slumped. The stockbrokers fled to safe havens in the US dollar, the Swiss franc and the Japanese yen. The African currencies, the South African rand, the Kenyan Shilling and the Nigerian Naira plummeted. The margin fell from first to eight percent, then caught himself, but at 3.6 percent. The rate of sterling stood at $ 1.3232 as lowest level since September 1985. The euro fell by as much as 4.1 percent to a three and a half-month low of $ 1.0914.
the depreciation of the pound is the UK, according to the think tank London Economics no longer the fifth largest economy in the world. “The pound has dropped so dramatically that we France has overtaken”, Reuters quoted the institute. For international comparison, GDP is weighted usually in dollars, against the pound so strong devalued after Proposed referendum on United Kingdom membership of the European Union-vote
It was truly a Black Friday on the stock exchanges. With panic selling investors worldwide responds. Fearing an economic crisis on the island and a slowdown in the global economy, the European stock indices rustled some cases more than ten percent in the depth.
investors believe their eyes not
So even when Dax , the German index. Investors believe their eyes when they looked at nine o’clock on the screens. Ten percent of rattled Dax beginning down.
Among professionals to depressed mood spread. “The decision to opt out of EU plunges Europe into an existential crisis,” said Nick Parsons, Co-Chief Strategist at National Australia Bank, told Reuters. Matt Sherwood, chief investment officer of fund manager Perpetual, warned: “The UK is slipping into recession and Europe will follow.”
The London FTSE 100 lost nearly nine percent. Friday is for all European equity markets, according to Reuters is the largest price drop in one day since the bankruptcy of US investment bank Lehman Brothers in the fall of 2008. She later limited their losses somewhat and traded 4.8 to 9.1 percent in the red. The African stock exchanges and bond markets also collapsed, the South African newspaper “Mail & writes amp; Guardian “.
The exchanges in Milan and Madrid contributed with a loss of around ten percent each to the largest daily loss in its history to. Investors feared in both states a further strengthening of EU-critical parties and withdrew their money. On Sunday a new parliament is elected in Spain. In October, the Italians will vote on a constitutional reform.
Sold were notably financials, which react disproportionately to the news. British financial institutions such as Royal Bank of Scotland (RBS) and Lloyds lost approximately 20 percent. German Bank and Commerzbank losing about about twelve percent. On commodity markets, prices faltered. The price for the trend-setting oil-Brent from the North Sea fell by 4.6 percent to $ 48.57 per barrel (159 liters). The important industrial metal copper cost with $ 4,686.50 per tonne two percent less than on Thursday.
Central banks want to calm the markets
According to estimates of DZ Bank analyst Christian Kahler have dissolved by the current crash world five trillion in market capitalization in air. This corresponds roughly to twice the annual economic output of the UK.
Asked contrast supposedly safe assets such as gold, government bonds and the Swiss franc were with investors. The precious metal recorded the biggest price jump since 2008. The gold price rose by as much as 8.2 percent to a two-year high of $ 1,358.20 a troy ounce (31.1 grams). This heaved the shares of the mine operator Randgold to a record high of 8350 pence.
was Begehrt the Swiss currency. The euro fell 2.8 percent to an eleven-month low of 1.0612 francs. During the morning the euro limited its losses but, rising to CHF 1.0838 after the Swiss central bank SNB intervened in the currency market.
The run on government bonds pushed the yield on the pioneering ten-year government bond to a record low of minus 0.17 percent. Their British counterparts yielded with 1.018 percent also lower than ever before. Here speculated investors on a rate cut by the Bank of England (BoE) and secured with the purchases, the current, higher interest rates. /]
After Proposed referendum on United Kingdom membership of the European Union-vote, leading central banks want to push against turbulence on the financial markets. The British central bank chief Mark Carney put 250 billion pounds to support the markets in prospect. The European Central Bank (ECB) and the Bank of Japan stressed their readiness to act. The Swiss National Bank stepped meanwhile equal to action and intervened in the currency market.
In addition to the variations in the euro, the ECB should also observe that the yields have rocketed on government securities southern European countries after the Proposed referendum on United Kingdom membership of the European Union in the air. Some experts have even speculated before the Proposed referendum on United Kingdom membership of the European Union-vote, the ECB could bring in extreme cases, its so-called OMT program to use, so buying targeted government bonds of crisis countries. Finally, on Tuesday the Constitutional Court had approved it under certain conditions. It would be the first time that the 2012 scheme introduced actually be frequented. ( with RTR / AFP)
For a detailed account of how stock investors can be protected by the old principle of rebalancing from the extreme swings of the stock market itself, read here.
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