Brexit - initial stock market winners and losers

The FTSE 100 was down 6.7% and the FTSE 250 falls 10.3% in the first half hour of trading.  Russ Mould, investment director at AJ Bell, comments:

“Some bargain hunters are pouncing on the weakness with a few blue chip stocks recovering some lost ground since the market open, albeit only minor compared to the overall decline.

Only 10 stocks in the FTSE 350 are in positive territory. Precious metal miners are leading the charge on the back of a 4.7% rise in the gold price. Acacia Mining advanced 14.7%, Randgold Resources is up 14% and Fresnillo jumped 11.9%. Rolls-Royce is a surprise riser with a 2.2% gain. Drug maker GlaxoSmithKline nudged ahead by 0.2%.

However, the majority of stocks are in negative territory:

PROPERTY FEARS

Housebuilders have taken the biggest hit from the EU referendum decision as investors fret about a slump in the property market.

Taylor Wimpey is down 40.3%, Berkeley falls 35.9%, Crest Nicholson drops 34.8% and Barratt Developments slumps 28.6%.

Broader property-related stocks have also dragged down. Commercial property developer British Land declined 28.9% as demand could be hit for its office blocks if foreign companies downsize their UK operations.

Flexible office provider Workspace has fallen 21.5% as investors worry about a decline in UK economic strength and the impact that might have on small businesses.

FINANCIAL FIRMS

UK-focused banks have been hit particularly hard. Lloyds Banking and Royal Bank of Scotland lead the fallers among the FTSE 100 banks. Lloyds plummets 26.1% while RBS dives 19.4% to 201.7p in early trading. Both have repositioned their operations in recent years to focus on UK retail and commercial markets.

Barclays did not escape the sell-off due to its large presence on the UK high street, falling 27.9% to 134.7p.

The UK’s largest bank by assets, HSBC appears to have avoided the worst from investor concerns falling only 4.8% to 433.8p. Although the lender operates from a tower in Canary Wharf much of its revenues are generated overseas.

In the FTSE 250, small business and residential mortgage lender Aldermore has 22.9% wiped off its market value. Shawbrook, which targets the same markets, has experienced a similar fall.“Shares in asset managers, whose income is dependent on the level of financial markets, also experienced heavy losses. London’s largest listed fund manager Schroders tumbled 20%, emerging markets focused Ashmore declined 14.3% and Jupiter Asset Management fallen 14.1%.

CONSUMER CONFIDENCE

Concerns about a slump in consumer confidence and the knock-on effect to spending patterns put a dent in leisure and retail stocks. Restaurant Group fell 29.8%, WH Smith retreated by 27.4% and Halfords droped 21.9%

In a double whammy of property and consumer spending fears, kitchens seller Howden Joinery droped 23%.

Tour operators took a big hit as the market will be worried about the potential increase in costs for travelling around Europe and the potential reluctance for consumers to go on foreign holidays if UK economic conditions come under pressure. Thomas Cook droped 25.4% and TUI retreated by 21.9%

EMPLOYMENT FEARS

Financial services recruitment specialist PageGroup is one of the day’s biggest fallers, down an extraordinary 52%.

Fellow mid cap staffing outfit Hays dipped 29% and midcap temporary recruiter Staffline reversed gains yesterday to trade 11% lower at £10.72.”

These articles are for information purposes only and are not a personal recommendation or advice.