Markets Finally Notice Brexit's Gaining Momentum

With the vote barely a week away, it looks like financial markets are finally beginning to take the possibility that Britain will leave the EU seriously.  Of course, it is usually impossible to pinpoint any one reason for the movement of a market on any particular day. But, in the US, the stock market was down for its fourth consecutive day with analysts pointing to Brexit as a factor.  And the fear of Brexit also contributed to the German 10-year bond yield going negative with some predicting those yields could fall even further.  And today, the NY Times’ Neil Irwin expresses some worry that financial markets are too complacent about the possibilities of Brexit, a slowing US economy, and even the election of Donald Trump.

Meanwhile, the momentum for “leave” seems to picking up as we head into the home stretch of this vote. As expected, Rupert Murdoch and his Sun newspaper finally come out forcefully against remaining under “dictatorial Brussels”. And, just like our US election, immigration has become a flashpoint. As I’ve mentioned before, Britain’s exit from the EU could be the first of many dominoes to fall that could reshape not only Britain but Europe as well.