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Monday opened with a more bullish market due to polls from Britain showing an increase in support for remaining in the EU rather than exiting under Brexit.
According to UK-based newspaper The Independent, the first polls on Brexit since the murder of MP Jo Cox show the majority shifting towards remaining in the EU. As the Telegraphreports, Cox, an adamant supporter of the “Remain” campaign was killed last Friday by a distraught supporter of Britain’s right-wing group, Britain First. The group is a staunch supporter of Brexit.
This recent shift in polls has had a visible effect on the market. Barclays Bank PLC (BCS - Free Report) has gone up 7.59%, the Royal Bank of Scotland up 7.87% and Lloyds Bank Group (LYG - Free Report) up 9.06%, respectively, since the opening bell, presumably due to the increase in investor confidence stemming from the aforementioned polls.
The financial services industry in the U.K. is very much at the mercy of Brexit. If it were to take place, many banks have stated that they would have to re-evaluate their positions in the region, and eliminate a sizable amount of jobs in the process. Because of the potential downside that would come with Brexit, the news that public opinion has (for now) shifted against it is a breath of fresh air for the industry.
The macroeconomic ramifications of Brexit are very apparent. Most notably, it could negatively impact trade and investment with countries such as the U.S., affecting up to $1 trillion of current volume. There has not yet been a definitive majority about Brexit, with polls as recently as last week showing that the majority opinion was to depart the EU, which as our team points outunsettled market momentum.
With a very volatile public opinion and the vote two days away, there is no certainty as to which way the referendum will go.
All that is left is to wait and see.
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Brexit: Britain's Newest Rollercoaster Ride
Monday opened with a more bullish market due to polls from Britain showing an increase in support for remaining in the EU rather than exiting under Brexit.
According to UK-based newspaper The Independent, the first polls on Brexit since the murder of MP Jo Cox show the majority shifting towards remaining in the EU. As the Telegraphreports, Cox, an adamant supporter of the “Remain” campaign was killed last Friday by a distraught supporter of Britain’s right-wing group, Britain First. The group is a staunch supporter of Brexit.
This recent shift in polls has had a visible effect on the market. Barclays Bank PLC (BCS - Free Report) has gone up 7.59%, the Royal Bank of Scotland up 7.87% and Lloyds Bank Group (LYG - Free Report) up 9.06%, respectively, since the opening bell, presumably due to the increase in investor confidence stemming from the aforementioned polls.
The financial services industry in the U.K. is very much at the mercy of Brexit. If it were to take place, many banks have stated that they would have to re-evaluate their positions in the region, and eliminate a sizable amount of jobs in the process. Because of the potential downside that would come with Brexit, the news that public opinion has (for now) shifted against it is a breath of fresh air for the industry.
The macroeconomic ramifications of Brexit are very apparent. Most notably, it could negatively impact trade and investment with countries such as the U.S., affecting up to $1 trillion of current volume. There has not yet been a definitive majority about Brexit, with polls as recently as last week showing that the majority opinion was to depart the EU, which as our team points outunsettled market momentum.
With a very volatile public opinion and the vote two days away, there is no certainty as to which way the referendum will go.
All that is left is to wait and see.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>