The Eurozone periphery bonds plunged on Friday after the United Kingdom voted in favor of leaving the European Union in an unprecedented vote, triggering a worldwide selloff in lower-rated debt and equities and a flight to haven investments such as German bunds.
The 10-year Italian sovereign bond inched higher 7-1/2 basis points to 1.400 percent, Portuguese 10-year bonds yield bounced 14 basis points to 3.242 percent, Spanish 10-year bonds yield climbed 7 basis points to 1.550 percent by 09:45 GMT.
Britain has voted to leave the EU in a popular revolt that will send shockwaves across Europe, leaving David Cameron’s premiership hanging in the balance and triggering financial market turmoil across the globe. With all the votes counted, 51.9 percent voted to sever Britain’s 43-year membership of the EU, 48.1 percent to stay in.
Following the UK electorate's historic decision to jettison EU membership, Prime Minister David Cameron is to step down as PM in three months time. This suggests Chancellor Osborne will stand down as Finance Minister as well.
Moody's said that the UK's Brexit decision is 'credit negative' as it "heralds a prolonged period of policy uncertainty that will weigh on the UK's economic and financial performance". It highlights the adverse implications for confidence, investment flows, and growth.
Moreover, Eurogroup head Dijsselbloem said that Europe is not in panic and common interest of making sure things develop in a "controlled manner". He further added that ECB priority is stability to allow economic recovery to continue. Also, The ECB confirms that it is ready to provide liquidity in Euros or other currencies. Similarly, Europe parliament chief Schultz said Britain chosen very difficult path.
Meanwhile, the pan-European STOXX 600 index was down 6.53 percent and the euro-area blue-chip gauge, the STOXX 50 dipped 8.50 percent. The FTSE 100 Index fell 4.97 percent, the DAX trading 6.61 percent lower and the CAC-40 fell 7.88 percent by 09:50 GMT.
