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| Market pressure eases after Brexit rout | Market pressure eases after Brexit rout |
| (35 minutes later) | |
| Pressure has eased on UK financial markets after two days of turmoil in the wake of the Brexit vote, with the FTSE 100 share index opening higher. | |
| Shortly after trading began, the index was up 2.2% at 6,113.01, while the FTSE 250 had gained 3.1%. | Shortly after trading began, the index was up 2.2% at 6,113.01, while the FTSE 250 had gained 3.1%. |
| The FTSE 100 lost 5.6% in the previous two trading sessions, while the more UK-focused FTSE 250 had slumped 13.7%. | |
| The pound also showed signs of recovery, rising 0.7% against the dollar to about $1.33. | |
| The pound had risen as high as $1.50 shortly before the result of the vote became clear on Friday morning. | |
| But on Monday, the currency plunged to a 31-year low against the dollar, while some share trading was temporarily halted. | |
| Also on Monday, yields on 10-year government bonds sank below 1% for the first time as investors bet on an interest rate cut. | Also on Monday, yields on 10-year government bonds sank below 1% for the first time as investors bet on an interest rate cut. |
| The UK market recovery was led by the sectors that had been worst hit in the past two days' trading - banks, property and airlines. | |
| Barclays and Lloyds were up 7% and 6% respectively, while housebuilders Persimmon and Taylor Wimpey were both more than 6% higher. | |
| Airline Easyjet, which saw big losses on Monday, was up nearly 3%. | |
| Life less 'rosy' | |
| The stock market rise came as Chancellor George Osborne warned that the UK faced further economic setbacks. | |
| "We are in a prolonged period of economic adjustment in the UK, we are adjusting to life outside the EU and it will not be as economically rosy as life inside the EU," he told the BBC's Today programme. | |
| However, he added: "I think we can provide a clear plan." | |
| Mr Osborne said that the recent dramatic market moves were natural: "The markets will move up and down as you've seen in the past 24 hours - we are in a period of prolonged adjustment." | |
| He said there were back-up plans in place: "We have contingency plans. The banks are safe and secure, the Treasury is working with the banks to provide stability for the markets and we spent a long time working on these plans." | |
| Early on Monday, the chancellor had attempted to reassure investors and calm the markets, saying the UK was ready to face the future "from a position of strength". | |
| Other European stock markets made gains in early Tuesday trading, with the Dax in Frankfurt up 2.3%, the Cac in Paris up 2.5% and Milan rising almost 3.4%. | |
| All three stock exchanges have fallen more heavily than London in the past two days of trading since the vote by the UK to leave the EU. |