Article / 22 June 2016 at 6:58 GMT

Morning Markets: Brexit eve jitters weigh on sentiment

Deputy Editor /



  • US: House Price Index (1300 GMT)
  • Eurozone: Consumer Confidence Indicator (1400 GMT)
  • US: Existing Home Sales (1400 GMT)

Brexit eve jitters weighed on sentiment across Asia today, although a positive lead from Wall Street helped ease anxiety, with some benchmark stock indices making slim gains. Japan's Topix index was an exception – it closed 0.72% lower, though off an earlier low of -1.22%.

Many in Asia would echo the "Stay" sentiment expressed on the front page of Germany's Der Spiegel magazine, against a background of the Union Jack: "Bitte Geh Nicht!" (Please don't go!). 

In Europe, bourses are expected to open mildly higher though with activity subdued by the impending referendum. In FX, sterling held largely steady in Asian trade, retaining some of the gains from the start of this week but again, like stocks, activity was restrained.

Elsewhere, Fed chair Janet Yellen's testimony yesterday garnered less attention that is usual as investors remained fixated by the Brexit vote and the implications in the event of a decision to quit the EU. However, the market did take note of Yellen's dovish comment expressing “considerable uncertainty about the economic outlook”.

Finally, for anybody who wants the Remain side to win the referendum, a nugget of hope – in a  televised debate last night (in front of a 6,000-strong audience) the Bremain lobby was perceived to have the upper hand as it landed a blow on the Brexiteers with the accusation that they were peddling "Project Hate", a new term and a possibly winning slur. We'll see.

Market signals

Asian session

  • Traders anxiously awaited the outcome of the UK vote on Thursday
  • Gains on Wall St overnight failed to ease jitters in Asia over Brexit uncertainty
  • The economic crisis in Venezuela could hurt world crude supplies
  • The Nikkei 225 retreated; it was down 0.35% to 16,112.90 at 0425 GMT
  • The Shanghai Composite headed higher; it was up 0.28% to 2,886.60 at 0528 GMT
  • Korea's Kospi Composite made gains; it was up 0.46% to 1,991.84 at 0510 GMT
  • Australia's benchmark S&P/ASX200 gained ground after a shaky start
  • The S&P/ASX200 closed up 0.22% to 5,279.70 at 5,286.20 points

Forex ahead

  • FX traders are making plans for a sharp GBP tumble if Britons opt to quit the EU
  • The US dollar edged slightly higher against the yen; it was worth ¥104.50 at 0531 GMT
  • The Australian dollar has made steady gains, and is edging close to 0.75
  • The Aussie dollar was worth 0.7460 at 0531 GMT

From the Floor

Countdown. “Most of the Brexit risk has now been priced out of gold”, says Hansen.

Deaf ears. “The Fed is a bit rudderless and markets don’t believe in its credibility”, says Hardy.

Get all the latest from Saxo Bank's trading floors in From the Floor, within the hour.

In opinion


As Britons prepare for a landmark vote on Thursday, there's plenty of data from other nations to consider, including releases on the vital US housing sector, says James Picerno

Crude supply fears

While much of the world is distracted by the UK vote, oil traders are worried that the crisis in Venezuela could hurt crude supplies, says the team at Saxo Capital Markets Australia

Kiwi haven

Suspicion that the Fed's rate hike path is moving from gradual to glacial makes traders warm to carry trade favourites such as the kiwi dollar, says Max McKegg

 New Zealand's distance from Brexit-driven volatility in world markets can be an advantage, and the NZ dollar is a carry trade favourite for FX traders. Photo: iStock

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22 June
Patto Patto
Good work ,,,,,,,,,I find these Morning Report summaries just about the best thing on TF, You go thru all the info/opinions and present the best.
23 June
Clare MacCarthy Clare MacCarthy
Why thank you Patto. Really kind of you to say so. I'm sure the other editors agree it makes getting up early worth it (or for the Australian editors, staying up late!).


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