Dow Falls after Brexit Vote

According to the Wall Street Journal the Dow Jones Industrail Average dropped 610.32, or 3.4% while the S&P 500 index fell 75.91 points, or 3.6%. These were the largest declines since August.

The Stoxx Europe 600 index fell 7%. The steepest drop since 2008, and Japan's Nikkei Stock Average declined 7.9%.

Investors who had been stacking bets the UK would vote to stay in the EU took a loss.
The downturn pushed investors to turn to the safety of gold, government bonds and the Japanese Yen and the Swiss franc. Foreign exchange markets took a beating by the decline in the pound against the dollars which reached 11% at one point.

“We haven’t had what I would say is a crash, but we’ve given back gains we’d taken months to make,” said Chris Semenuk, manager of the TIAA-CREF International Equity Fund.

A number of other stock markets in Europe also took a beating, dropping at least 12% in Greece, Spain and Italy. Many Italian bank stocks didn’t open for trading as there were no buyers even the sellers were offering deeply discounted prices.

“It calls up memories of the worst days of the European political crisis around Greece,” said Bo Christensen, chief analyst at Danske Invest. Christensen expects a mild recession in the U.K. and Europe, but he predicts that the impact on the U.S. will be limited to the short term.

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Dow Industrials Tumble After ‘Brexit’ Vote

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