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You can find the current article at its original source at https://www.theguardian.com/business/live/2016/jun/27/pound-shares-markets-brexit-crisis-osborne-lew-business-live
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| Pound hits new 31-year low, as Brexit fears grip markets – business live | Pound hits new 31-year low, as Brexit fears grip markets – business live |
| (35 minutes later) | |
| 1.16pm BST | |
| 13:16 | |
| Ireland’s stock market is suffering a major selloff today. | |
| The Dublin bourse has shed 7.7% today, making it the worst-performing eurozone market. | |
| Irish stocks now down almost 8%, Bank of Ireland down 18%, Ryanair -10%. Bigger drop than Friday's....double-ouch. | |
| 1.06pm BST | |
| 13:06 | |
| Lord King blasts government over Project Fear | |
| Mervyn King, who steered the Bank of England through the last financial crisis, has criticised the government for trying to scare the public during the election campaign. | |
| He was speaking to the BBC’s Laura Kuenssberg: | |
| Just spoken to Lord King - most important he says, don't panic, long term economic difference btw In and Out not that big | |
| But King wades right into the politics-he says both sides in campaign exaggerated, blasts Treasury | |
| And the former Governor says Osborne and PM treated people like 'idiots' by scaremongering and voters didn't like being treated that way | |
| Lord King also says the emergency budget was the 'nadir' of the campaign | |
| Updated | |
| at 1.11pm BST | |
| 12.57pm BST | |
| 12:57 | |
| The FTSE 100 index has now shed 130 points today, on top of Friday’s 199 point losses. | |
| That means the index has lost £85bn since the referendum result, in a blow to small investors and pension funds. | |
| For a party for pensioners the Tories really have engineered a bloody blow for the pension pot with these equity falls | |
| Updated | |
| at 12.58pm BST | |
| 12.56pm BST | |
| 12:56 | |
| Investors are hammering the pound and the stock market because they have no real idea what the next plot twist in the astounding Brexit drama might be. | |
| Joshua Mahoney of spread-betting firm IG explains: | |
| For all of the statements of intent on both sides pre-referendum, it seems that much of it holds little basis in reality. First Farage admitted that the £350 million weekly NHS funding claim was a mistake and now Osborne has stepped back from his pledge to impose an immediate emergency budget. | |
| The name of the game now is stability and for that reason Osborne is crucial despite his previous support for the remain camp. Amid all the calls for Corbyn’s head and the clamour for the new PM role, financial markets are trying to ascertain what this will truly mean for the UK, the European Union and global stability. | |
| Many traders have concluded that Britain’s housing industry is heading into a downturn, sending shares in builders and estate agents slumping (not helped by Foxton’s profit warning today) | |
| Housebuilders really hurting now ... #Brexit pic.twitter.com/eGweANf2a1 | |
| 12.49pm BST | 12.49pm BST |
| 12:49 | 12:49 |
| Ouch. The pound just hit $1.316, a new post-1985 low. | Ouch. The pound just hit $1.316, a new post-1985 low. |
| 1.316 - so the pound is stable, eh Bojo ? GLWT. | 1.316 - so the pound is stable, eh Bojo ? GLWT. |
| Sterling getting beaten like it owes money. | Sterling getting beaten like it owes money. |
| 12.46pm BST | 12.46pm BST |
| 12:46 | 12:46 |
| Chris Saint, senior currency analyst at Hargeaves Lansdown, has warned that the pound could suffer large losses in the weeks ahead: | Chris Saint, senior currency analyst at Hargeaves Lansdown, has warned that the pound could suffer large losses in the weeks ahead: |
| “It’s a sea of red for sterling again this morning as investor sentiment continues to sour after the UK’s vote to leave the EU. The pound has slipped below €1.20 against the euro this morning for the first time in more than two years. It has also fallen to fresh lows under $1.32 against the US dollar – the lowest level since 1985. | “It’s a sea of red for sterling again this morning as investor sentiment continues to sour after the UK’s vote to leave the EU. The pound has slipped below €1.20 against the euro this morning for the first time in more than two years. It has also fallen to fresh lows under $1.32 against the US dollar – the lowest level since 1985. |
| Exchange rates will inevitably remain very volatile in the coming days and weeks as currency markets digest the far-reaching implications of the referendum result. | Exchange rates will inevitably remain very volatile in the coming days and weeks as currency markets digest the far-reaching implications of the referendum result. |
| Further significant losses for sterling aren’t out of the question, especially if incoming data confirms the UK economy’s slowdown and lifts the likelihood of further Bank of England stimulus to support growth. | Further significant losses for sterling aren’t out of the question, especially if incoming data confirms the UK economy’s slowdown and lifts the likelihood of further Bank of England stimulus to support growth. |
| Pound now down versus the dollar around 12 per cent since Thursday night: pic.twitter.com/KReBjMbNSx | Pound now down versus the dollar around 12 per cent since Thursday night: pic.twitter.com/KReBjMbNSx |
| 12.43pm BST | 12.43pm BST |
| 12:43 | 12:43 |
| This tweet from the FT shows how smaller UK companies have been hit extra-hard by Brexit. | This tweet from the FT shows how smaller UK companies have been hit extra-hard by Brexit. |
| Sterling weakness shields FTSE 100, but UK-centric FTSE 250 feels the Brexit burn. https://t.co/KHhOEthGl4 pic.twitter.com/RNzj6PzNLU | Sterling weakness shields FTSE 100, but UK-centric FTSE 250 feels the Brexit burn. https://t.co/KHhOEthGl4 pic.twitter.com/RNzj6PzNLU |
| The purple line shows the FTSE 250 index, which has dropped more sharply than the FTSE 100 (which includes multinational companies who will benefit from the weak pound). | The purple line shows the FTSE 250 index, which has dropped more sharply than the FTSE 100 (which includes multinational companies who will benefit from the weak pound). |
| 12.41pm BST | 12.41pm BST |
| 12:41 | 12:41 |
| Shares in RBS, the bank still more than 70%-owned by UK taxpayer, down 23% today close to crisis-level lows. Down nearly 40% since Friday. | Shares in RBS, the bank still more than 70%-owned by UK taxpayer, down 23% today close to crisis-level lows. Down nearly 40% since Friday. |
| 12.05pm BST | 12.05pm BST |
| 12:05 | 12:05 |
| Share selloff gathers pace | Share selloff gathers pace |
| Shares are hitting fresh lows after another wild morning in the markets. | Shares are hitting fresh lows after another wild morning in the markets. |
| The FTSE 100 index of major blue-chip companies is now down 100 points, a loss of 1.6%. That follows a 199-point tumble on Friday. | The FTSE 100 index of major blue-chip companies is now down 100 points, a loss of 1.6%. That follows a 199-point tumble on Friday. |
| Easyjet has lost a fifth of its value, followed by Royal Bank of Scotland and Barclays (both down over 15%), and building firms such as Taylor Wimpey, Persimmon and Barratt. | Easyjet has lost a fifth of its value, followed by Royal Bank of Scotland and Barclays (both down over 15%), and building firms such as Taylor Wimpey, Persimmon and Barratt. |
| And there are bigger losses among smaller UK companies. | And there are bigger losses among smaller UK companies. |
| The FTSE 250 index, of medium-sized firms, has slid by 5% today. Small ‘challenger’ banks are being absolutely hammered, due to fears that the UK could be dragged into recession. Shawbrook, Onesavings and Virgin Money are all down over 20%. | The FTSE 250 index, of medium-sized firms, has slid by 5% today. Small ‘challenger’ banks are being absolutely hammered, due to fears that the UK could be dragged into recession. Shawbrook, Onesavings and Virgin Money are all down over 20%. |
| Royal Bank of Scotland’s shares are worth watching closely amid all the market turmoil, as the taxpayer still holds a big stake. | Royal Bank of Scotland’s shares are worth watching closely amid all the market turmoil, as the taxpayer still holds a big stake. |
| Our City editor, Jill Treanor, explains: | Our City editor, Jill Treanor, explains: |
| At their current level of 170p, the share are back at levels they last traded at during February 2009, when the banking crisis was in full swing. The break even price for the taxpayer is 502p, and the only stake sold by the government in August 2015 was at 330p. | At their current level of 170p, the share are back at levels they last traded at during February 2009, when the banking crisis was in full swing. The break even price for the taxpayer is 502p, and the only stake sold by the government in August 2015 was at 330p. |
| With any hopes of a further sell off of the government’s stakes off the cards, analyst at Deutsche Bank said RBS was the most afffected by Brexit of all the big UK banks. The analysts point out that the sale of the 300-odd branches to be branded Williams & Glyn - demanded by the EU at the time of the bailout - will be further delayed. And regulators are unlikely to sanction any distribution to shareholders. | With any hopes of a further sell off of the government’s stakes off the cards, analyst at Deutsche Bank said RBS was the most afffected by Brexit of all the big UK banks. The analysts point out that the sale of the 300-odd branches to be branded Williams & Glyn - demanded by the EU at the time of the bailout - will be further delayed. And regulators are unlikely to sanction any distribution to shareholders. |
| 11.55am BST | 11.55am BST |
| 11:55 | 11:55 |
| Bloomberg are reporting that Janet Yellen, head of the US Federal Reserve, is no longer appearing at a conference in Portugal this week. | Bloomberg are reporting that Janet Yellen, head of the US Federal Reserve, is no longer appearing at a conference in Portugal this week. |
| ECB REMOVES FED CHAIR YELLEN FROM SCHEDULE FOR SINTRA FORUM | ECB REMOVES FED CHAIR YELLEN FROM SCHEDULE FOR SINTRA FORUM |
| Yellen had been due to appear at the European Central Bank’s Sintra forum, alongside Mark Carney, Bank of England governor. Carney pulled out over the weekend, to focus on events in London. | Yellen had been due to appear at the European Central Bank’s Sintra forum, alongside Mark Carney, Bank of England governor. Carney pulled out over the weekend, to focus on events in London. |
| 11.48am BST | 11.48am BST |
| 11:48 | 11:48 |
| Sports Direct rating slashed amid Brexit worries | Sports Direct rating slashed amid Brexit worries |
| Simon Goodley | Simon Goodley |
| It may not be the biggest issue to come out of a Brexit, but some in the market are pondering how Thursday’s vote will affect Sports Direct, the embattled sports goods retailer that operates a controversial warehouse in Derbyshire that is largely staffed by immigrant labour from eastern Europe. | It may not be the biggest issue to come out of a Brexit, but some in the market are pondering how Thursday’s vote will affect Sports Direct, the embattled sports goods retailer that operates a controversial warehouse in Derbyshire that is largely staffed by immigrant labour from eastern Europe. |
| The most pressing issue for the company, seems to be the price of sterling, so today’s selloff won’t help. | The most pressing issue for the company, seems to be the price of sterling, so today’s selloff won’t help. |
| The group issued a statement on Friday stating that the currency’s weakness was “likely to impact purchases for which the company is currently not hedged for the FY17 period and beyond”. In plain English, that means it buys much of its stock from Asia and that is now going to cost it a lot more. | The group issued a statement on Friday stating that the currency’s weakness was “likely to impact purchases for which the company is currently not hedged for the FY17 period and beyond”. In plain English, that means it buys much of its stock from Asia and that is now going to cost it a lot more. |
| This morning, the investment bank Goldman Sachs has downgraded the retailer’s shares to a “sell”, reasoning: | This morning, the investment bank Goldman Sachs has downgraded the retailer’s shares to a “sell”, reasoning: |
| “We expect the combination of a demanding European apparel demand environment (notably in the UK post the EU referendum), gross margin pressure (currency driven) and elevated opex growth due to a one-off wage bill increase to drive a lower EPS base in FY17 and FY18 (FY16- 18E EPS 36.05p/30.78p/32.45p), despite the European football event this summer”. | “We expect the combination of a demanding European apparel demand environment (notably in the UK post the EU referendum), gross margin pressure (currency driven) and elevated opex growth due to a one-off wage bill increase to drive a lower EPS base in FY17 and FY18 (FY16- 18E EPS 36.05p/30.78p/32.45p), despite the European football event this summer”. |
| So that means investors being told to sell the sports chain’s shares by Goldman Sachs, which is an adviser to, er, Sports Direct. | So that means investors being told to sell the sports chain’s shares by Goldman Sachs, which is an adviser to, er, Sports Direct. |
| 11.35am BST | 11.35am BST |
| 11:35 | 11:35 |
| Brits should brace for higher inflation, unless the pound gets its breath back and recovers. | Brits should brace for higher inflation, unless the pound gets its breath back and recovers. |
| 31 year low in £/sterling will directly impact on sterling oil price and therefore petrol prices, in coming weeks... Unless it proves a blip | 31 year low in £/sterling will directly impact on sterling oil price and therefore petrol prices, in coming weeks... Unless it proves a blip |
| 11.27am BST | 11.27am BST |
| 11:27 | 11:27 |
| Today’s tumble in the pound, and the plunge in UK borrowing costs, indicate that investors expect interest rates to be cut to record lows. | Today’s tumble in the pound, and the plunge in UK borrowing costs, indicate that investors expect interest rates to be cut to record lows. |
| City analyst Louise Cooper says: | City analyst Louise Cooper says: |
| The move in sterling cannot be purely viewed as a negative dire message - “loss of faith in UK blah blah”, but also a realisation that interest rates will be cut by the Bank of England. Rate cuts tend to drive currencies lower. | The move in sterling cannot be purely viewed as a negative dire message - “loss of faith in UK blah blah”, but also a realisation that interest rates will be cut by the Bank of England. Rate cuts tend to drive currencies lower. |
| It is particularly dramatic as at the end of last year, Sterling was pricing in a rate increase. | It is particularly dramatic as at the end of last year, Sterling was pricing in a rate increase. |
| Investors now fully pricing in at least one cut in UK interest rates in coming months. Pencilling in Bank rate of 0.2% by turn of year | Investors now fully pricing in at least one cut in UK interest rates in coming months. Pencilling in Bank rate of 0.2% by turn of year |
| 11.15am BST | 11.15am BST |
| 11:15 | 11:15 |
| The pound has hit a two-year low against the euro, at €1.2017. | The pound has hit a two-year low against the euro, at €1.2017. |
| 11.07am BST | 11.07am BST |
| 11:07 | 11:07 |
| Pound hits new 31-year low | Pound hits new 31-year low |
| BOOM! The pound just hit a new 31-year low against the US dollar, as Brexit fears continue to grip the financial markets. | BOOM! The pound just hit a new 31-year low against the US dollar, as Brexit fears continue to grip the financial markets. |
| Sterling slumped over 4 cents to $1.3220, a level last seen in 1985, beating last Friday’s low. | Sterling slumped over 4 cents to $1.3220, a level last seen in 1985, beating last Friday’s low. |
| George Osborne’s attempts to calm the markets are not preventing investors from piling out the pound. | George Osborne’s attempts to calm the markets are not preventing investors from piling out the pound. |
| Investors are nervous because they have no idea when the UK might formally begin the process of exiting the European Union. | Investors are nervous because they have no idea when the UK might formally begin the process of exiting the European Union. |
| Ken Odeluga, market analyst at City Index, explains: | Ken Odeluga, market analyst at City Index, explains: |
| The Prime Minister has stated that he intends to leave the task of triggering Article 50 to his successor and we don’t expect him to go back on that at the European Council summit this week. | The Prime Minister has stated that he intends to leave the task of triggering Article 50 to his successor and we don’t expect him to go back on that at the European Council summit this week. |
| That leaves sterling with no more visible means of support than it had on Friday. | That leaves sterling with no more visible means of support than it had on Friday. |
| Historic times..... | Historic times..... |
| Sterling drops to new low of $1.3217. Last time this low Jagger/Bowie 'Dancing in the Street' was No.1 #Brexit #1985 pic.twitter.com/Gi3XvXUsJN | Sterling drops to new low of $1.3217. Last time this low Jagger/Bowie 'Dancing in the Street' was No.1 #Brexit #1985 pic.twitter.com/Gi3XvXUsJN |
| Updated | Updated |
| at 11.11am BST | at 11.11am BST |
| 10.58am BST | 10.58am BST |
| 10:58 | 10:58 |
| RBS and Barclays weren’t the only major companies to be BRIEFLY suspended this morning: | RBS and Barclays weren’t the only major companies to be BRIEFLY suspended this morning: |
| LSE: Barclays, RBS, Taylor Wimpey, Berkeley Group, Legal & General all triggered automatic suspension today. Happens with large movements. | LSE: Barclays, RBS, Taylor Wimpey, Berkeley Group, Legal & General all triggered automatic suspension today. Happens with large movements. |
| 10.35am BST | 10.35am BST |
| 10:35 | 10:35 |
| RBS and Barclays *briefly* suspended | RBS and Barclays *briefly* suspended |
| Important point. There are reports that trading in shares in Barclays and Royal Bank of Scotland have been suspended due to the market panic. | Important point. There are reports that trading in shares in Barclays and Royal Bank of Scotland have been suspended due to the market panic. |
| That’s not strictly correct. Both shares were temporary suspended, after triggering automatic pauses due to high volatility. | That’s not strictly correct. Both shares were temporary suspended, after triggering automatic pauses due to high volatility. |
| But right now, RBS and Barclays shares are still changing hands -- down 14% and 10% respectively. | But right now, RBS and Barclays shares are still changing hands -- down 14% and 10% respectively. |
| For context - Barclays shares were suspended twice during the day on Friday. Automatically triggered https://t.co/9z7Sp8MKCj | For context - Barclays shares were suspended twice during the day on Friday. Automatically triggered https://t.co/9z7Sp8MKCj |
| Updated | Updated |
| at 10.36am BST | at 10.36am BST |