Here are the top five things you need to know in financial markets on Friday, June 24:
1. Brexit approved in U.K., PM to resign
The final results of the U.K.’s referendum on its membership in the European Union (EU) gave the victory to Brexit, as the decision to leave is known, early on Friday morning.
Britain voted by a substantial margin to exit the EU, with the Leave side winning 52% of the vote, against 48% to remain.
British Prime Minister David Cameron announced his resignation in October based on the Remain defeat, saying he would “attempt to steady the ship” over the coming weeks and months.
2. Global stocks sharply lower on Brexit outcome
Global stocks slumped on Friday as the results of the U.K.’s referendum were confirmed.
Asian stocks were all lower, while Japan’s Nikkei, off almost 8%, saw its worst decline since 2011.
European stocks also took heavy losses as the U.K. announced its decision to leave the EU.
U.S. futures also pointed to a sharply lower open. Analysts had warned prior to the voted that a Brexit could send the S&P up to 9% lower. Specifically, at 9:51AM GMT, or 5:51AM ET, the blue-chip Dow futures sank 477 points, or 2.66%, S&P 500 futures shed 72 points, or 3.43%, while the Nasdaq 100 futures slumped 153 points, or 3.45%.
3. Pound crashes to 30-year low, BoE prepares for action
Sterling took a beating on Friday, plunging to $1.3231, its lowest level since 1985 and its biggest drop on record.
Bank of England (BoE) governor Mark Carney insisted that the central bank was “well prepared” to support markets, ready to provide more than £250 billion ($347 billion) of additional funds through its normal facilities.
4. Investors flee to safe haven assets; gilt yields hit record low
U.K. sovereign bonds, known as gilts, were being bid up, pushing the yield on benchmark 10-year bonds down 35 basis points to a record low of 1.02% amid fears over the long-term implications of Brexit on the global economy.
As investors fled to safe haven assets, gold rallied to 27-month highs on Friday, while the yen hit its highest level against the dollar since November 2013.
5. Oil plunges on Brexit victory, stronger dollar
Oil prices sank on Friday as investors moved away from riskier assets in light of the U.K.’s decision.
A stronger dollar also put downward pressure on black gold, as crude becomes more expensive for buyers using other currency.
U.S. crude oil futures plunged 4.53% to $47.84, at 9:54AM GMT, or 5:54AM ET, while Brent oil sank 4.58% to $48.58.
Energy traders looked ahead to Friday's rig count report from Baker Hughes for further indications on whether U.S. shale producers are continuing to return online, as oil prices stabilize. A week earlier, the U.S. oil rig count rose by nine to 337 for the week ending on June 10, representing their third straight weekly increase.