(updated 05:03 GMT)
Britain’s decision to leave the European Union triggered massive volatility in the global financial markets, pushing investors into the safety of the Japanese yen.
In an emergency press conference on Friday Japanese finance minister Taro Aso said his government will “take firm action on the yen if needed,” mirroring his previous comments about the “one-sided” advances in the Japanese currency. However, the finance minister stopped short of promising currency intervention. He also declined to comment whether Japan had already intervened in the market.
The Japanese yen spiked to nearly three-year highs against the dollar Friday morning, with the USD/JPY exchange rate reaching a low of 99.0070. That was the first time the pair fell below 100 since 2013.
Mr. Aso commented on Friday that he was “very concerned” about the impact of the Brexit vote on the financial markets, describing the reaction as “extremely jittery.”
A strong yen poses a challenge for the Bank of Japan, which is desperately trying to re-inflate the economy through loose monetary policy. The yen has risen sharply against the dollar since the beginning of the year, a trend expected to intensify given the new market reality.
Japanese stocks experienced a violent selloff following the news of Britain’s withdrawal from the EU. The Nikkei 225 Index was last down over 1,200 points or 7.6%.
(updated 04:47 GMT)
Britain’s campaign to leave the European Union prevailed on Thursday, sending global markets into recession-style volatility as the British pound plunged to 30-year lows against the dollar.
With nearly 90% of polls counted, 51.7% of Britons have voted to leave the European Union (EU) after a dramatic race that shocked the majority of pollsters who had expected a clean victory for the Remain camp.
The British pound has declined a staggering 11.6% – more than 1,700 pips – against the dollar. The GBP/USD exchange rate bottomed at 1.3230, its lowest level since the mid-1980s.
Sterling declined across the board, posting sharp declines against the euro, Japanese yen and Swiss franc, among others.
The Japanese yen, widely regarded as a store against volatility, spiked to two-and-a-half year highs against the dollar, forcing the Japanese government to call an emergency press conference. The USD/JPY exchange rate bottomed at 99.0070 before consolidating in the low-101 region.
The dollar index, which tracks the performance of the US currency against a basket of six currencies, spiked nearly 3% to 96.117.
Futures trading on the London FTSE 100 Index plunged over 500 points or 8.3% in pre-market activity. Investors can expect an extremely volatile start to the day for the London Stock Exchange on Friday.
The Brexit vote triggered a massive selloff in Japan, with Tokyo’s Nikkei 225 index declining over 1,100 points or 7.2%. The index touched an intraday low of 14,890.56, putting it on pace for its lowest settlement since August 2014.
Hong Kong’s Hang Seng Index also plunged nearly 1,000 points or 4.7%.
American stock futures also experienced a massive selloff, with the Dow Jones mini declining 660 points. Investors can expect heavy volatility on Wall Street Friday.
Silver futures also surged 52 cents or 3% to $17.87 a troy ounce, which was a new 15-month high.
A surging dollar triggered a sharp selloff in oil prices. The West Texas Intermediate (WTI) benchmark for US crude futures plunged nearly 6% to $47.17 a barrel. Brent crude, the international futures contract, also fell 6% to $47.87 a barrel.
(updated 04:25 GMT)
Britain’s campaign to leave the European Union overcame the odds to prevail on Thursday, sending global markets into a panic.
With nearly 90% of ballots counted, Britain’s Leave campaign headed by Tory MPs Boris Johnson and Martin Gove has opened up a 2.4 percentage point lead.
According to political analysts, the next major question is whether David Cameron stays on as Prime Minister. The embattled leader campaigned hard to convince the public and members of his own cabinet to remain in the EU. Those efforts appear to have failed as of 5:23 am.
As the final votes trickle in, the public can expect an official announcement shortly.
(updated 04:19 GMT)
With just over 70 areas left to declare, Leave has registered more than 14 million votes and was around 2.6-million votes short of officially declaring victory.
The night began with UKIP leader Nigel Farage conceding defeat to vote Remain. Several hours later, he gave a controversial ‘victory’ speech highlighting Leave’s victory against corruption and “big politics.”
(updated 04:13 GMT)
Leave Vote Extends Lead, 81% Reporting
With over 27 million ballots counted, Britain’s Leave campaign has extended its lead to 2.4 percentage points, a sign that the United Kingdom was on its way to exiting the EU.
The Sunderland result earlier in the night set the tone for a much stronger than expected showing for the Brexit camp. Nearly all of the polls on Wednesday showed clear support for Remain, which had been gaining momentum since the weekend.
Vote Leave is around 2 million votes shy of declaring victory.
More to come.
(updated 04:02 GMT)
Sterling’s decline accelerated in the overnight session, as investors continued to search for a bottom following what appears to be a historic vote to leave the European Union.
The GBP/USD touched a low of 1.3306, putting it on pace for its worst single-day decline on record.
The pound also sold off against the euro, with the EUR/GBP exchange rate surging 7.2% to 0.8162.
The selloff is likely to intensify at the start of European trading should the results of the referendum confirm a Brexit victory.
(updated 03:58 GMT)
With Britain moving closer to leaving the European Union, Asian and global markets have sold off sharply, as an already shaky investor climate braces for an uncertain future.
Japan’s Nikkei 225 Index has plunged more than 800 points or 5% to 15,421.19, putting it on pace for its lowest settlement since after the “Black Monday” crash of August 24.
Hong Kong’s Hang Seng Index was down nearly 1,000 points or 4.8% at 19,873.58.
Japanese policymakers will hold a press conference within the hour as investors pile into the yen, a global safe-haven currency. The dollar-yen exchange rate referenced by the global markets has plunged over 6% to 99.99, the lowest level since November 2013.
A strong yen presents several challenges for Japan, which is desperately trying to stimulate its economy through easy monetary policy.
More to come…
(updated 03:51 GMT)
With nearly 80% reporting, Britain’s campaign to leave the European Union has achieved more than 12.6 million votes, making it the odds-on favourite to win the most critical election in recent history.
With 78.8% of the votes counted, the Leave camp holds a firm lead with 51.8% of the vote, according to the last update at 4:39 am.
(updated 03:45 GMT)
The British pound has lost a staggering 10% over the course of three hours, slumping to its lowest level since 1985 amid growing momentum in the ballots for Britain’s Leave camp.
The pound-dollar exchange rate referenced by the global financial markets has declined 10% or 1,500 pips to 1.3518, putting sterling on pace for its lowest closing in decades.
Futures on the FTSE 100 have also declined 7.5%.
Stay tuned for updates…
(updated 03:41 GMT)
With UKIP leader Nigel Farage giving an impromptu “victory” speech, pollsters and even pro-EU Labour MPs are calling for a Leave victory now that nearly 60% of ballots have been counted.
“If the predications now are right this will be a victory for real people, a victory for ordinary people, a victory for decent people,” Mr. Farage said in the early morning hours. “We have fought against the multinationals, against the big merchant banks, against big politics, against lies against lies, corruption and deceit and today honesty and decency and belief in nation I think now is going to win.”
There are already calls for David Cameron’s resignation. Hilary Benn, the UK’s foreign secretary, sees no plausible way for Mr. Cameron to remain on as leader.
More to come…
(updated 03:03 GMT)
UKIP leader and Brexiteer Nigel Farage appears to have changed his tone from earlier this evening, when he conceded that Remain would likely win Britain’s EU referendum.
“I now dare to dream that the dawn is coming up on an independent United Kingdom.” Mr. Farage said in a Twitter statement.
The Leave camp is coming up on 7 million votes, representing 51.4% of the total share based on 46.3% of total ballots reporting. The British pound has since extended its losses to nearly 10% or 1,400 pips. Futures on the FTSE 100 are down 476.5 points or 7.6%.
Asian stock markets opened lower across the board Friday, with Japan’s Nikkei 225 index plunging nearly 500 points or 3.1%. Hong Kong’s Hang Seng Index was also down 3.2% in the early morning.
Brexit bets fueled a sharp selloff of American stock futures. The Dow Jones mini was last down over 500 points.
(updated 02:47 GMT)
Vote Leave is “cautiously optimistic” that the UK is headed for Brexit, according to the campaign’s chief director Matthew Elliott.
“We are not calling it yet,” Mr. Elliott said. “There’s still a long way to go and we have to wait for the results in London but at the moment it is looking pretty good.”
The Leave campaign reached 6 million votes by 3:23 am, giving it a 51.3% share of the ballot. The Leave campaign’s surprising strength has triggered unprecedented volatility for the British pound, which has plunged a staggering 8.5%. For currency traders, that’s equivalent to over 1,300 pips.
Trading in the FTSE 100 futures market also reached chaotic levels. FTSE 100 futures plunged 337.5 points or 5.4% through the overnight session.
According to The Guardian, the pro-EU Labour party is now working on the assumption that the Leave camp will prevail.
(updated 02:07 GMT)
The campaign to remain in the European Union has opened up the narrowest of leads with 24% of ballots accounted for, but a leading pollster now says that a Brexit is the most likely outcome.
Betting website Oddschecker is giving a 55% chance that the Leave vote prevails once all 382 counting areas have been declared. That marks the first time since campaigning began that a Leave vote was considered more likely to prevail among bookies.
According to the latest results, 50.1% of voters back Remain compared to 49.9% who support Leave. The race appears to be much closer than the final polls suggested, which almost unanimously gave the momentum back to Remain.
(updated 00:52 GMT)
Large victories in Newcastle and Sunderland have propelled the UK’s Leave camp into the lead, based 3% of the total referendum vote.
The Brexit campaign headed by Conservative MPs Boris Johnson and Michael Gove has received 54.7% of the referendum vote, according to the latest update. Leave scored more convincing victories in the regions of North Antrim, Swindon and Lagan Valley. In the case of North Antrim, 62.2% of voters backed leave.
According to analysts, Swindon could be seen as an important proxy for the rest of the country, given that it is a swing Labour/Conservative region. Swindon voted leave with 55% of the vote.
Elsewhere, Leave scored a big victory in the North East region of Basildon. The regions of Hartlepool, Stockton-on-Tees and Merthyr Tydfil also backed leave.
Remain captured the regions of Eilean Siar, West Tyrone and Dundee City, according to the latest results.
(updated 23:53 GMT)
Huge celebrations erupted in Sunderland Thursday night after the Leave camp secured 61.3% of the vote, giving a huge boost to the Brexit campaign after UKIP leader and Brexiteer Nigel Farage had reportedly conceded defeat.
Leave’s commanding victory in Sunderland was much bigger than forecasts. Experts had predicted Leave would fail nationally if the gap in the Sunderland result was less than six points.
With 1.3% of ballots reporting, vote leave has received 50.5% of the vote versus 49.5% in favour of remain.
The British pound plunged following the Sunderland results, with the GBP/USD exchange rate shedding 2.6% to 1.4618. For currency traders, that’s a more than 400-pip decline.
(updated 23:40 GMT)
The campaign to leave the European Union (EU) conceded defeat Thursday night after exit polls showed a commanding lead for the Remain camp, although pollsters urged caution in proclaiming that either side had won.
UKIP leader and Brexit campaigner Nigel Farage has reportedly told the Telegraph “Remain will win with 52%,” adding that the “government did a very good job” by extending the voting deadline to allow another two million voters to register.
The Ipsos Mori on-the-day poll showed support for Remain at 54% compared to 46% backing Leave.
Early results show 57.3% of voters in favour of Remain compared to 42.7% in favour of Leave. However, the closely followed EU referendum betting markets has shown a large uptake in Brexit bets after Sunderland voted leave with a commanding 61.3% of the vote.
Elsewhere, Clackmannanshire voted to remain with 57.8% of the vote.
More still to come.