Global stock markets held their collective breath on 23rd June 2016 when the UK population went to the polls to vote on the EU referendum. The following day saw many global stock markets fall significantly only to recover significantly over the proceeding weeks. The FTSE 100 saw wild gyrations in its constituents’ share prices not just on the following day but also over the following weeks.
UK-focused stocks that generate a significant percentage of their revenue in sterling saw large declines in their share prices as sterling fell sharply against a basket of major currencies. As an example, over the preceding week (i.e. June 24th 2016 to 1st July 2016), the standout sectors that fell sharply were: UK housebuilders (Barratt Developments 41.5%, Persimmon 45.5%), UK banks (Barclays 32.5%, Royal Bank of Scotland 44.5%), UK airlines (International Consolidated Airlines 38%, EasyJet 40.5%), UK retailers (Next 11%, Dixons Carphone 33.5%).
Meanwhile, multinational stocks that are often classed as ‘defensive’ due to their geographical diversification and that also generate a significant percentage of their revenue in US dollars, saw large gains in their share prices as many major currencies rose sharply against sterling. As an example, over the preceding week (i.e. June 24th 2016 to 1st July 2016), the standout sectors that rose sharply were: pharmaceuticals (GlaxoSmithKline 13%, AstraZeneca 17%), tobacco (British American Tobacco 10.5%, Imperial Brands 8.5%) and consumer goods (Diageo 14%, Unilever 11.5%, Reckitt Benckiser 5.5%).
5 stocks to buy for the Brexit negotiations.
This complimentary report aims to guide the reader on the outlook of future negotiations between the UK and EU and highlight five stocks that have the potential to attractive investment returns going forward.
Post Article 50 Special Report Key Topics:
5 Stocks for the Brexit Negotiations
A Recent Guide from History: The Brexit Reaction
The Impact of Foreign Exchange
Trade-off: Growth vs Sentiment
Triggering Article 50: What Happens Next?
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