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Summary

  1. Sterling down 8% against the dollar and 6% against the euro
  2. Banks and housebuilders among biggest fallers on FTSE 100
  3. Wall Street falls more than 3% after London closed 3.1% lower
  4. European stock markets hammered

Live Reporting

By Dan Macadam

All times stated are UK

Get involved

Good night!

It's been a historic day with a record number of readers for the Business Live page - close to 1.1 million - logging on for reaction from  the financial world to the UK's momentous decision to leave the European Union. 

For those who want a little bit more coverage of the fallout from the referendum, you can catch it here on the politics live page. Thanks and good night!

Flight to safety

Gold bars
Reuters

Gold has jumped 5% to $1,322 an ounce - its highest level in more than three years as investors sought safety on a tumultuous day for global markets.

Crude oil, on the other hand, fell $2.50 to $48.41 a barrel amid the uncertainty.

"Recessions cause low oil prices and the UK break with the EU raises concern of a recession in Europe," said James Williams of WTRG Economics. 

Lew to lead US conference call

The heads of all the US financial regulatory agencies will hold a conference call on Friday to discuss the Brexit vote, the Treasury Department said. 

US Treasury Secretary Jack Lew will preside over the discussion of the Financial Stability Oversight Council, which was created in response to the 2007-09 financial crisis. 

The council includes the heads of the Federal Reserve, Securities and Exchange Commission and the Commodity Futures Trading Commission.  

Second referendum?

Boris Johnson
PA

Is there a chance the UK could face a second EU referendum? 

Boris Johnson was just one of the Vote Leave figures to raise that possibility at the start of the campaign.

And barrister Jolyon Maugham says there are two possible ways it could happen. The first is a general election won by an explicitly Remain party.

The other is that parliament could decide circumstances had changed sufficiently to put it to another vote. This is what happened in Ireland in 2009, he adds.

BreakingWall Street sinks

NYSE trader
Getty Images

Wall Street wobbled further in the last hour of trading in New York, with the Dow Jones ending more than 600 points, or 3.4%, lower at 17,400 points - the biggest one-day fall in almost five years.

The S&P 500 fell 3.6% - the biggest daily slide in 10 months - while the Nasdaq slumped 4.1%. That was the tech-focused index's worst day since 2011.

Housing market hope (or disappointment)

For sale sign
Getty Images

Worried (or pleased) that Brexit might mean lower house prices? Grainne Gilmore, UK residential analyst at Knight Frank, has some good (or bad) news for you:

In the short-term, consumer confidence is likely to be knocked by the continued uncertainty, especially with regards to trade. This may weigh on activity in the housing market, especially those making discretionary purchases, which could result in a slip in transaction volumes, and prices. However, uncertainty could also result in a further dampening of homes coming onto the market, and this lack of supply will provide a floor under prices."

Zero growth?

BBC Business Live

UBS offices in London
AP

BBC business correspondent Joe Lynam tells a special edition of Business Live that UBS is predicting UK economic growth will swiftly fall to zero this year. 

The Swiss bank forecasts that GDP will remain at zero for much of 2017, raising the strong likelihood of a recession, he says.

It won't take much - economic growth slowed to 0.4% in the first quarter of the year.

A messy divorce between two Britains

Remain supporters react to EU referendum results
AFP
Many supporters of the Stronger In campaign were horrified by the outcome over the vote

This is not just a split between Britain and the EU - it feels just as much like a split between one Britain and another.

Remain supporters react to EU referendum results

A messy divorce between two Britains

This is not just a split between Britain and the EU, it feels just as much like a split between one Britain and another.

Read more

Whisky sour

Scotch Whisky Experience
Getty Images

Makers of Scotch whisky - who export more than 90% of their tipples - have called on the government to ensure their access to European markets is not threatened.  

The nature of future trade arrangements with the EU single market and the wider world requires "urgent attention", says David Frost, chief executive of the Scotch Whisky Association.

Still, shares in drinks firm Diageo - which told staff before the vote that it would be "better for the UK, better for Diageo and better for the Scotch whisky industry that we remain in" - rose 2.5% on hopes that it will benefit from a weaker pound. 

Wall Street slips further

Goldman Sachs patch
Reuters

A quick update on how the US markets are digesting the UK's decision to leave the EU.

Shares on Wall Street have dropped a bit more since the falls at the opening bell. The Dow Jones industrial average is now down 3%, while the S&P 500 is off 3.2% and the tech-focused Nasdaq has fallen 4%. 

Goldman Sachs is the biggest loser on the Dow, falling 7.1%, followed closely by JP Morgan with a 6.6% drop.

Obama: UK focused on 'orderly transition'

Zoe Thomas

US business reporter

President Barack Obama
Reuters

President Obama has told an entrepreneurs conference in California that he spoke with David Cameron and was "confident that the UK is committed to an orderly transition out of the EU".

"We agreed that our economic and financial teams will remain in close contact as we stay focused on ensuring economic growth and financial stability," Mr Obama said at Stanford University.

“Yesterday's vote speaks to the ongoing changes and challenges that are raised by globalisation,” he added.

Bumpy ride

Easyjet and Ryanair planes
Getty Images

The statement issued by easyJet chief executive Carolyn McCall this morning - "we remain confident in the strength of easyJet's business model and our ability to continue to deliver our successful strategy and our leading returns" - didn't stop its shares falling 16.5% in London today.

That was not as bad as the 22.5% slide in shares of British Airways owner IAG, which issued a profit warning following the EU vote - but was considerably worse than the mere 6.4% fall for Ryanair. 

On the agenda

Foresight News has put together a handy list of the most significant events of the next three days:

Saturday

  • 9:30am: Emergency Scottish Cabinet meeting
  • 12:30pm: Angela Merkel press conference
  • 2:30pm: Francois Hollande meets with Marine Le Pen

Sunday

  • Elections in Spain

Monday

  • 8am: Trading begins on London and European markets
  • 9am: Extraordinary session of the European Parliament on Brexit
  • 9:30am: David Cameron chairs Cabinet meeting
  • 2:30pm: Parliament returns from recess
  • 6pm: Parliamentary Labour Party meeting following no-confidence motion in Jeremy Corbyn
  • 6:30pm: ECB Forum on Central Banking (runs to June 29)
  • Angela Merkel, Francois Hollande, Donald Tusk and Matteo Renzi meet
  • Extraordinary meeting of European Commissioners
  • The Queen and Duke of Edinburgh visit Northern Ireland

Lagarde: 'We hope for the best'

IMF managing director Christine Lagarde
AFP/Getty Images

Christine Lagarde, the head of the International Monetary Fund - which had warned a Leave vote would trigger a recession in the UK - tells the BBC:

We are respecting completely the decision of the British people. We hope very much for a smooth and predictable transition period and we are very reassured by the statements made by [Bank of England governor Mark] Carney and we ourselves stand ready in a spirit of good cooperation in order to face the current situation and we hope for the best."

Volatility 'can be contained'

Bank of International Settlements in Switzerland
BIS

Global uncertainty from the Brexit vote "can be contained", according to the Bank of International Settlements - the central bank of central banks.

The Swiss-based institution says it's confident that good cooperation in the banking sector can help with the high volatility.

Are house prices going to fall?

Moneybox's Paul Lewis answers listeners' questions about Brexit

'A mistake'

Twyford Cookers
Twyford Cookers

Ian Norman of Twyford Cookers - a Herefordshire retailer selling upmarket kitchen appliances - has given his view of the Brexit vote:

"We think the exit from the EU is a mistake and will cause a year - possibly two - of continued hard times. The main issue for us will be the uncertainty in consumers' minds about the future which will lead to an even more cautious spending pattern," he says.

"We do believe, however, that there will be a steady recovery from the current initial over-reaction and that we will settle down again. The British are stalwart in nature and always up for coping with the unexpected."

Business and Brexit: whatever next?

Douglas Fraser

Scotland business & economy editor

Vote Leave badge
Reuters

Has business been crying wolf? Heavily weighted to the Remain side, the voices of business Britain and corporate Caledonia raised a lot of serious concerns about the economic consequences of Brexit.

They lost the vote. And now, they're telling us they can cope with the upheaval that's being thrown at them.

That's because they have to.

For the full blog, click here.

Biggest FTSE 250 fall

Virgin Money office in Norwich
Reuters

Today's falls were much heavier on the FTSE 250, which is regarded as a better barometer of UK businesses than the global titans on the FTSE 100.

The index closed at 16,088 points - down 7.2% or 1,245 points.

That was the biggest daily slide for the index, and equated to £25bn being wiped off the value of its companies, according to the LSE.

UK bank Aldermore was the biggest loser (falling 32%), along with Virgin Money (down 25%). 

Property developers also fared badly, with Crest Nicholson down 26%, Derwent London falling 25% and Bellway off 24%.

FTSE 100 winners

GSK
Getty Images

Despite the turbulence, plenty of FTSE 100 stocks ended the day in positive territory.

Drug makers GlaxoSmithKline and Astra Zeneca were among the big winners, both rising more than 3%. British American Tobacco, Unilever, and publisher Pearson also made gains.

Laith Khalaf, an analyst at Hargreaves Lansdown, says the winners were "predominantly companies with lots of overseas earnings, which stand to benefit from a weaker pound".  

Wrecking ball

Construction work on new high rise
Getty Images

The UK's biggest house builders took a walloping on the markets today. 

They accounted for four of the five biggest losers on the FTSE 100, as investors judged them to be the most exposed to UK economic shocks.

Taylor Wimpey was the worst hit (down 29%), followed by Persimmon (28%), Barratt (24%) and the Berkeley Group (21%).

British Airways owner IAG was another big loser, falling 23% after it issued a profit warning following the referendum outcome. 

Major UK banks were also badly hit. Lloyds fell 21%, while Barclays and RBS both slid 18%. HSBC, which has a large Asian business, fell just 1.4%.

All change?

David Cameron after EU negotiation
Reuters

Now that the FTSE has closed, here's a bit of context.

When David Cameron announced the EU referendum on 20 February:

- The FTSE 100 was at 5,950 points. It closed at 6,138, having dropped as low as 5,806 earlier in the day.

- The yield on 10-year UK government bonds stood at 1.41%. A short while ago it stood at a record low of 1.018%.

- The pound was worth $1.44. This is where the clearest impact from the EU vote has been felt - sterling is currently down 8.3% against the dollar at $1.3639.

The price of Brexit

Business Live reader Ed Clinkett emails to ask: 

"I would like to know how much is the exit going to cost us as taxpayers?"

Answers on a postcard please...

BreakingFTSE 100 falls 3.15%

The FTSE 100 has ended the day at 6,138.69 points, down 199 points. That's still considerably higher than the 5,806 it touched earlier this morning.

European markets have been well and truly spanked, however, with the Dax in Frankfurt down 6.8% - its worst day since the financial crisis in 2008, the Cac in Paris shed 8%, Madrid fell 12%, while Milan takes the wooden spoon with a 12.5% plunge.

Wall Street is also lower lower, with the S&P down 2.7% and the Dow 2.1% lower.

China 'monitoring events'

PBOC
Reuters

Zhou Xiaochuan, governor of the People's Bank of China, says it has been monitoring events in the UK and that "more study" will be needed to fully understand the implications of the Brexit vote.

Sterling is down 6.6% against the yuan this afternoon.

Interest rates heading to zero?

Bank of England governor Mark Carney
AP
Bank of England governor Mark Carney

Pimco, the world's largest bond fund, has become the latest to predict that the Bank of England could cut interest rates to zero as a way of boosting the economy.

"Near-term, the UK economy will be pulled lower by the uncertainty created by the referendum vote. As a result, we expect the Bank of England to cut the official interest rate to zero from 0.5%," writes Mike Amey, head of sterling at Pimco.  

However, he expects a period of "greater relative calm" in the medium term as the transition to life outside the EU will take time to negotiate.

London property still in demand

One Hyde Park
Getty Images

Brexit may not be all doom and gloom for the top of the London property market, according to Guy Gittins at estate agency Chestertons.

"We are already seeing a renewed appetite from cash-rich Europeans and people dealing in dollars, who will certainly be in a strong position on the back of currency value swings. We put out a briefing to clients today, and in just a few hours we’ve registered a huge number of new buyers keen to look at all price ranges and locations," he says.

"Prices had levelled off to a fair degree as the referendum drew near and uncertainty over the outcome mounted, so I would predict that house prices in the most sought-after locations should stay pretty much where they are."

Sports Direct warns on pound hit

Sports Direct sign
PA

Sports Direct has put out a stock market announcement to say it will be affected by market volatility - in particular "material changes to sterling/dollar exchange rates" - caused by the UK's decision to leave the EU.

This is likely to "impact purchases for which the company is currently not hedged", the retailer said.

Shares in Sports Direct are down 16% with about 30 minutes of trading to go.

Clothing retailers have warned that the pound's steep drop - down 7.2% against the dollar a short while ago - will make imported materials more expensive.

LSE merger fears

LSE
Getty Images

Shares in London Stock Exchange Group are down 8.6% on fears that its mega-merger with Deutsche Boerse may flounder.

Germany's Wirtschaftswoche reports that the Deutsche Boerse works council is now arguing that Brexit means Frankfurt should become the legal headquarters of the combined group.

The council made a similar call earlier this month.