Sterling down 8% against the dollar and 6% against the euro
Banks and housebuilders among biggest fallers on FTSE 100
Wall Street falls more than 3% after London closed 3.1% lower
European stock markets hammered
Image source, PAReuters is reporting on Russia's reaction to the Brexit vote.
"Moscow wants the EU to remain a major economic power which is prosperous, stable and predictable," Kremlin spokesman Dmitry Peskov said.
"We have a pretty heavy burden of uneasy ties with Great Britain," he added.
"We hope that in the new realities, an understanding of the need for good relations with our country will prevail."
Image source, Getty ImagesHousebuilder shares have plunged following the UK vote to leave the European Union.
Barratt shares have lost more than 21% - but the firm said it was prepared for Brexit.
Quote MessageWe have prepared for this eventuality and whilst we recognise there will be a period of uncertainty as the UK’s exit is negotiated, the strong fundamentals of our business are unchanged. There is a structural undersupply of quality homes in the UK, and we have a clear strategy to address this, supported by a strong balance sheet to execute our growth plans... We are confident our business can respond to the changing landscape and we remain focussed on driving it forward."
European equivalent of the UK's CBI comments on the vote to leave the EU ...
Quote MessageWe now call on EU and national politicians to live up to the challenges when putting in place the measures to follow on the decision of the UK voters. BusinessEurope and all its member federations believe in Europe. Now it is time to return to our common European interests. We are eager to contribute to moving our continent and its economy forward. At the same time, the UK is an important trading partner. Building a new and sustainable type of relationship with the UK is therefore in everybody’s interest.
Markus J Beyrer, Businesseurope director general
The Local Government Association has called for the central government to protect EU regeneration funding.
Quote MessageCommunities in England have been allocated £5.3 billion of EU regeneration funding up to 2020. It is important for the government to guarantee it will protect this vital funding to avoid essential growth-boosting projects stalling and local economies across England being stifled."
LGA
Tom McPhail of Hargreaves Lansdown says pensioners seeing the value of their retirement savings fall today should "do nothing unless you have to."
"If you are close to retirement, then try to avoid selling funds and shares right now. Annuity rates may move in response to changing interest rates, however this is not certain.
"If you are in retirement and drawing an income from your investments then a good default strategy is to draw the natural yield (dividends from equities, interest on fixed interest stocks) as this means you aren’t cashing in the capital value of your investments at a time when they are falling in value."
Vodafone, the world's second biggest telecoms company and a linchpin of the FTSE 100 index, said it was too soon to form a view on where the UK-based company would be domiciled after Britain voted to leave the European Union.
The group said on Friday it was committed to supporting its British customers now and in the future, but added:
"It is too soon to form a view on the implications of the referendum outcome for the domicile of the group."
Image source, Getty ImagesQuote MessageFollowing the outcome of the UK referendum, the European Central Bank is closely monitoring financial markets and is in close contact with other central banks. The ECB stands ready to provide additional liquidity, if needed, in euro and foreign currencies. The ECB has prepared for this contingency in close contact with the banks that it supervises and considers that the euro area banking system is resilient in terms of capital and liquidity. The ECB will continue to fulfil its responsibilities to ensure price stability and financial stability in the euro area.
European Central Bank
Business reporter Simon Falush writes
UK-listed airlines are among those most battered by the leave vote.
EasyJet has slumped 19%, putting it among the top 10 fallers on the FTSE 100, while IAG, which owns British Airways has plunged 20%.
An analyst at a North American bank in London noted that both are disproportionately exposed to the UK economy.
“Around 49% of EasyJet revenue comes from the UK and it has been hit by uncertainty and the potential for economic weakness which would hit demand,” he said.
He said that while Ryanair whose shares are down 14% has 84 bases around Europe enabling them to switch to different markets, both Easyjet and IAG’s bases are much more focused on the UK.
He added that the weakness in the pound was another factor set to dent demand as holidaymakers feel more uncertain.
“EasyJet had a very bullish outlook on summer demand and the weaker pound will likely hit bookings for last minute holidays, so there may be another 5% profit downgrade.”
Quote MessageThis marks the biggest upheaval of our legal system in history – its scale simply cannot be underestimated. It covers everything from financial services to food labelling, from data protection to employment law. Tens of thousands of laws are now up for grabs. The job of deciding which laws to keep and which to abandon is too big for politicians to do unguided. Anyone doing business in the UK needs to assess their key pressure points and protect their interests. Businesses are facing years of uncertainty as they consider how they will continue to provide services and market products cross-border into the EU.
Chris Bryant, Partner, City law firm Berwin Leighton Paisner
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Following the UK vote to leave the EU, in Germany the Dax is down more than 6% and the Cac 40 has fallen more than 8%.
The FTSE 100 is more than 5% down, after plunging more than 8% earlier.
IAG reacts to EU exit vote ...
Image source, Getty ImagesQuote MessageIAG believes that the vote to leave the European Union will not have a long term material impact on its business. In the short term, however, in the run up to the UK referendum during June, IAG experienced a weaker than expected trading environment. Following the outcome of the referendum, and given current market volatility, while IAG continues to expect a significant increase in operating profit this year, it no longer expects to generate an absolute operating profit increase similar to 2015."
Enrique Dupuy de Lome, IAG chief financial officer
Image source, Getty ImagesThe Society of Motor Manufacturers and Traders was one of the most vocal business lobby groups backing the Remain campaign - now it's reacting the the news of Brexit:
Quote MessageThe British public has chosen a new future out of Europe. Government must now maintain economic stability and secure a deal with the EU which safeguards UK automotive interests. This includes securing tariff-free access to European and other global markets, ensuring we can recruit talent from the EU and the rest of the world and making the UK the most competitive place in Europe for automotive investment."
Mike Hawes, SMMT Chief Executive
Quote MessageThis is an unprecedented situation for the UK and BIBA is conscious that this will create a considerable amount of work and concern amongst members and their customers. The process of negotiating exit terms, setting out future arrangements with the EU and creating trading deals is likely to take some considerable time and will impact our industry during that period. BIBA will work with the Government and other authorities to ensure that the interests of insurance brokers and their customers are fully represented in these vital negotiations. BIBA will make this a priority work stream during this time.
British Insurance Brokers' Association
Image source, Getty ImagesQuote MessageDeutsche Boerse and London Stock Exchange note the result of the UK Referendum which recorded a majority of votes in favour of leaving the European Union. As stated in the shareholder documents published on 1 June 2016, the recommended all-share merger of LSEG and Deutsche Boerse is not conditional on the outcome of the referendum. The LSEG Board and the Deutsche Boerse management board remain fully committed to the agreed and binding merger terms, and continue the process of obtaining the necessary approvals."
A short while ago shares in RBS were down 16% - having fallen about 24% earlier - on the news that the UK has voted to leave the EU.
Now the bank has put out the following statement seeking to reassure customers.
Quote MessageOur number one priority is to serve and support our customers and our staff stand ready to help them with any questions or concerns they may have. We would like to reassure all our customers that there will be no immediate impact on their everyday banking services. We are operating business as usual and have no current plans to change where we operate or how we operate in response to the referendum result. There will now be a period of time to work through the implications of the vote with regulators. We will obviously work closely with the government during this period and will keep our customers updated on any future developments."
RBS Spokesman
Image source, Getty ImagesQuote MessageThe UK construction industry has been heavily reliant on migrant workers from Europe for decades now – at present, 12% of the British construction workers are of non-UK origin. The majority of these workers are from EU countries such as Poland, Romania and Lithuania and they have helped the construction industry bounce back from the economic downturn when 400,000 skilled workers left our industry, most of which did not return. It is now the Government’s responsibility to ensure that the free-flowing tap of migrant workers from Europe is not turned off. If Ministers want to meet their house building and infrastructure objectives, they have to ensure that the new system of immigration is responsive to the needs of industry.
Brian Berry, Federation of Master Builders chief executive
Business reporter Simon Falush writes...
Image source, Getty ImagesGlaxoSmithKline was one of less than 10 stocks in positive territory on the FTSE 100, up around 0.4%.
Analyst Emmanuel Papadakis at MainFirst Bank said it was supported by the pound’s weakness and the fact that pharmaceuticals stocks tend to be seen as a relatively safe bet in times of financial turbulence.
“It’s extremely defensive and is a safe haven. It benefits from the currency impact because it reports in sterling.”
A lower pound makes its products competitive relative to companies that report in other currencies, which should support sales.
Other stocks in positive territory include engineer Rolls Royce, which benefits from its products being cheaper for overseas buyers because of the weaker dollar, and miner Randgold which has been supported by higher prices for precious metals.