Last week the fears of many were realised when the UK voted to leave the EU. Major markets fell and the Pound tanked, as any rational person would have expected. Last week marked the end of June’s trading from the perspective of these summaries and the end of Q2. It makes for interesting study when adding the perspective of time
In Europe over the course of the week, the FTSE was actually up on last week’s close by down by 1.9%, it closed at 6138.7, but fell by 1.1% in June and by 0.12% over Q2; the Dax ended at 9557.2, down by 0.77% on last week’s close, falling by 5.4% in June and 2.4% over the quarter; the CAC was down by 2.1% to end the session at 4106.7, falling 7.1% in June and by 5% in Q2.
The Dow ended the week down by 1.6% to close at 17400, slipping by 2.3 on the month and by 2.2% over the quarter. The Nasdaq composite index ended down by 1.9% over the course of the week at 4708, losing 4.7% in June and 2.2% in Q2.
The Nikkei 225 ended the week’s trading down by 4.2% to end the session at 14952, it fell by 10% in June and 7.5% in Q2.
The falls (apart from the Nikkei) appear quite modest, but this is because gains generated in the expectation of a remain vote were wiped out. The Japanese losses stem from the Yen’s position as a safe haven currency.
Currency markets review
On the currency markets last week the Yen enjoyed the best of the trading owing to its safe haven reputation. The Dollar was stronger against Sterling last week closing at $1.3683 to the Pound, a gain of 4.2% on the week, 5.8% in June and 3.7% in Q2. The Greenback strengthened against the Euro last week by 1.2% to close at $1.1118 to the €, it made 1.9% in June and 2.3% in Q2. The Dollar was weaker against the Japanese currency, closing at 102.2 Yen to the Dollar, making a loss of 1.9% during the week, 4.4% in June and 8.8% over the quarter which explains the pressure on the Nikkei.
The Euro was weaker against the Yen ending at 113.6, a loss of 3.1% over the course of the week, 6.2% in June and 11% over Q2. It made ground against Sterling last week, rising by 3%; the close saw one £ buying €1.2307, it gained 4% over the week, but only 1.4% in Q2.
The Euro now buys 1.0829 CHF, a loss of 2.3% on the week and the month, but a modest loss of 0.78 over the quarter.
Commodities market review
On the commodities market, the price for Brent crude ended at $48.41 per barrel, a fall of 1.6% over the course of the week’s trading, 2.5% in June but rose by 25% in Q2. The value of gold was higher last week, closing at $1316.4 per ounce, a gain of 1.3% on the week, 5.8% on the month and 7.7% on the quarter.