Just over two weeks since the Brexit results and the UK remains in a political limbo. Financially-speaking, however, things are beginning to calm down. After the initial shock, the markets have quietened, with the FTSE100 even moving ahead of where it was before the referendum in GPBs. It looks like Europe has survived the immediate, violent reaction and the focus now shifts to what continued uncertainty, and a withdrawal from the EU, will mean for the UK, and the rest of the world.
The main industries affected
One of the most recent industries to take a hit was the property industry. House prices have fallen and property funds have suffered. Standard Life have suspended redemptions in its UK Retail property fund and has £2.9bn of assets under management. With London no longer seeming an attractive investment destination, Real Estate Investment Trusts have been hit too, with some dropping by as much as 20%.
Other industries hit include the Automotive, Airline, and Pharmaceutical. Of the 1.6 million cars manufactured in the UK, 77% are exported abroad, and over half of these to EU countries. UK-based airlines now have to rethink European routes and must recalculate fares, taking the new cost of visas into account. This is particularly hard for low-cost airlines like EasyJet, whose share price dropped 20%. It is not uncommon for UK pharmaceutical companies to carry out research and business overseas which will no doubt cause logistical issues but, more importantly, leaving the EU means the European Medicines Agency is no longer responsible for authorising UK pharmaceuticals which could mean slower approval for UK-manufactured drugs.