World stocks tumble as Brexit nightmare comes true

Global stock markets lost about $2 trillion (€1.8 trillion) in value on Friday after Britain voted to leave the European Union, while sterling suffered a record one-day plunge to a 31-year low and money poured into safe-haven gold and government bonds.

The blow to investor confidence and the uncertainty the vote has sparked could keep the Federal Reserve from raising interest rates as planned this year, and even spark a new round of emergency policy easing from major central banks. The move blindsided investors, who had expected Britain to vote to stay in the EU, and sparked sharp repricing across asset classes.

Mainland European equity markets took the brunt of selling as investors feared the vote could destabilise the 28-member bloc by prompting more referendums.

Dublin

The Brexit backlash precipitated one of the biggest sell-offs on Dublin’s stock market in recent decades. The Iseq shed roughly €7 billion in value, closing the session nearly 8 per cent down at 5,878.

The worst hit stock was Bank of Ireland, which derives about 30 per cent of its earnings from the UK. The bank's share ended the day down nearly 21 per cent at 21.5 cents, having been down 25 per cent at one stage. Permanent TSB was down 17.5 per cent to €1.80.

Banks suffered more than other stocks because of the potential knock-on affects for the Irish economy from Brexit.

Kingspan also bore the brunt of the meltdown. The insulation maker, which also has a relatively large exposure to the UK economy, fell by 21 per cent or €5.29 to €19.80.

Having been down 20 per cent, Ryanair closed just under 10 per cent down at €12.33 on very large volume trading. The airline's announcement of a further share buyback initiative mid-session appears to limited the losses.

Packaging giant Smurfit Kappa was down 11.4 per cent at €20.50, which was roughly in line with the industry norm.

Iseq heavyweight CRH was down 6 per cent at €25.60 while newly merged Paddy Power Betfair fell 4.6 per cent to €108.50.

Ireland's largest food group Kerry, which has less business in the UK than many of its peers, remained largely unaffected by the wider collapse, finishing 0.6 per cent down at €79.47.

London

More than £50 billion has been wiped off the value of the UK’s biggest companies after Britain voted to leave the EU.

The FTSE 100 Index closed down 3.15 per cent, falling 199.41 points to 6138.69, as it recovered from a 7 per cent plunge earlier in the session when David Cameron announced he would quit as PM by October following the Brexit vote. But the London market regained some poise – finishing higher at the end of the week than at the start – after the Bank of England pledged to intervene to help shore up the markets.

It was the housebuilders which bore the brunt of the slump, with Taylor Wimpey standing at the top of the biggest fallers, off more than 29 per cent or 56.3p at 136.1p. Charles Church-owner Persimmon was down 27 per cent or 578p to 1520p, while Barratt Developments slid just shy of 24 per cent or 137.7p to 439.8p.

Lloyds Banking Group took a hefty hit, down 21 per cent or 15.2p to 57p, while Barclays dropped 17 per cent or 33.1p to 153.9p. Among the travel firms under pressure, British Airways-owner IAG was more than 22 per cent down, falling 119p to 409p as it warned over profits following Brexit.

Europe

The Stoxx Europe 600 Index tumbled 7 percent in the worst day since the height of the financial crisis. The volume of shares changing hands on the

European gauge was almost four times higher than the 30-day average. Frankfurt and Paris each fell 6 per cent to 8 per cent.

Italian and Spanish markets, and European bank stocks overall , were headed for their sharpest one-day drops ever.

New York

US stocks fell sharply on Friday, with the Dow Jones industrial average dropping as much as 538 points. Banks stocks, which had risen strongly this week in anticipation that Britain would stay in the EU, were among the biggest losers. The financial index fell 4.74 per cent, leading sector decliners, and was set for its worst day in 10 months. Citigroup was down 8.4 per cent and Morgan Stanley 9.6 per cent, while Bank of America, JPMorgan and Goldman Sachs dropped by between 6 and 7 per cent. Apple, which got more than a fifth of its revenue from Europe last quarter, was down 2.5 per cent.