Markets Brace for Rocky Friday After UK Votes to Exit EuroZone

Defying consensus forecasts, UK citizens voted 52% to "Leave" vs 48% to "Remain" with a margin of 1.3 million out of 33.5 million votes cast.  Urban voters favored "Remain" by 60/40, but rural voters voted substantially in the other direction.   White collar "info-workers" have generally benefited from UK integration into the European Union, while blue collar, less educated and older Britons generally faired worse.  Here is the distribution of votes across Great Britain, Scotland, Wales and Northern Ireland.  Labor party voters favored "Remain," Conservative party voters favored "Leave."

World markets trended higher over the last two months on the expectation that the UK would remain in the EU.  This morning, we're seeing a sharp, unpleasant reversal in markets overseas and in US stock market futures:

  • British pound down 7.9%
  • Euro down 2.9%
  • UK FTSE down 4.0%
  • French CAC 40 down 8.5%
  • German DAX down 7.0%
  • Japan Nikkei down 7.9%
  • US S&P 500 futures down 3.9%

David Cameron, prime minister of the UK, resigned, saying,

"I was absolutely clear about my belief that Britain is stronger, safer and better off inside the European Union, and I made clear the referendum was about this and this alone - not the future of any single politician, including myself.

Read the entire commentary here.