Global Shares Rebound On Tuesday; EU Leaders Hold Meeting in Brussels Over Brexit

U.S. stocks opened higher on Tuesday, the British pound has strengthened 1.22 percent against the dollar, and the British FTSE 100 is 2.74 percent higher which follows 2 heavy days of selling in the market after Britain’s surprising vote last Thursday to leave the EU that caught investors off-guard, resulting in $3 trillion erased from global stock markets during the past 2 trading days, and the British pound dropping below a 31 year low on Monday.

Today British PM David Cameron is gathering in Brussels along with EU leaders for an emergency summit over last Thursday’s Brexit vote and faces increasing pressure from the EU to officially call for Britain’s exit from the EU by invoking Article 50 of the Lisbon Treaty that sets in motion the 2 year negotiation process for Britain to leave the EU, a decision that needs approval from the other 27 member states and will result in Britain re-negotiating its relationship with other European countries.

Britain is divided about leaving the EU and its June 23rd referendum vote to leave the EU culminated in 3 credit downgrades from 3 credit agencies and led to Prime Minister Cameron resigning on Friday along with a disclosure that Article 50 won’t be triggered until October when a new political leader can be chosen.

Facing the prospect of a nation wide recession, a possible referendum vote in Scotland vote to remain in the EU, recent calls for tax increases by British Chancellor George Osborne to secure the country’s finances, and rising odds that London could lose its luster as the financial center of Europe, many international banking institutions and tech companies based in London are feeling confused and uncertain about how to plan for the ramifications of Britain’s historic exit from the EU.

Written By:

Johnathan Schweitzer




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