So the FTSE has closed up at the highest level since 21 April, at 6,338.1.
The pound hit a six-month high against the dollar, rising above $1. 48 for the first time in 2016.
Sterling is currently up 0.7% at $1.4807. It is also up 0.1% against the euro at €1.3030.
In the US, Wall Street is also making strong gains.
- Dow Jones: +1% at 17,958
- S&P 500: +1% at 2,107
- Nasdaq: +1.1% at 4,451
That’s it for today. Our main referendum blog is still running and covering all the key political developments:
Thank you for joining us today. AM
FTSE stages late rally
The FTSE 100 has staged a late rally as trading comes to a close for the day.
Earlier in the day it was up by more than 100 points, but the majority of the gains were lost as investor nerves picked up - leaving the FTSE up just 18 points at one point.
The FTSE has closed for the day at 6,338.1, up 77 points or 1.2%.
Here is how things look at the close elsewhere in Europe:
- Germany’s DAX: +1.9% at 10,257.03
- France’s CAC: +2% at 4,465.9
- Spain’s IBEX: +2.1% at 8,885.3
- Italy’s FTSE MIB: +3.7% at 17,966.17
Andy Scott, economist at HiFX, has a good take on the pound:
After clocking up an impressive rally of nearly 2% on Thursday - hitting a 6-month high against the US dollar as the polls showed a late swing to a Remain vote - sterling reversed course sharply this afternoon.
GBP/USD fell 200 points from its high to $1.4750 as traders took profits on the earlier rally, positioning themselves cautiously ahead of a still uncertain outcome.
Leading into this evening, we expect liquidity to fall further as banks reign in FX activity, especially in GBP transactions with no one wanting to get their fingers burnt by the expected big moves that are possible in either direction.
We expect some initial reaction in Sterling to the exit polls after 10pm, with the main excitement likely to be in the early hours of Friday morning once we starting getting the results in.
The pound is up 0.5% against the dollar at $1.4777.
It’s up 0.07% against the euro at €1.3024.
Latest on the markets:
Europe:
- FTSE 100: +0.6% at 6,301
- Germany’s DAX: +1.1% at 10,185
- France’s CAC: +1.1% at 4,428
- Spain’s IBEX: +1.2% at 8,806
- Italy’s FTSE MIB: +2.7% at 17,798
Wall Street:
- Dow Jones: +0.9% at 17,946
- S&P 500: +0.7% at 2,101
- Nasdaq: +1% at 4,447
Updated
Brits have been rushing to buy their holiday money according to No.1 Currency.
The foreign exchange firm said business jumped by 70% on Wednesday, with queues forming at some of its 102 high street stores, and online sales up 300%.
Simon Phillips, retail director at No.1 Currency:
Demand has rocketed for all foreign currencies, but euros and dollars are proving especially popular.
Our stores came close to running out of the most popular currencies on Wednesday, and as high demand continues today we’ve dramatically increased stock levels to cope with the surge in demand during the final hours before the result is announced.
So it appears that investors are feeling a little less bold this afternoon, with referendum jitters creeping back in.
Connor Campbell of Spredex has a view:
Things have calmed down somewhat since that midday frenzy, the European indices looking increasing nervy as closing time creeps closer.
The indices receded from their midday peaks, instead returning to the calmer trading seen earlier in the morning.
So, that’s almost it. One imagines that regardless of the result tomorrow with be a far more hectic day of trading, be it caused by a post-Brexit plunge or a relieved wave of investors pouring back in to buy up the pound et al.
UK investors are losing some enthusiasm now.
The FTSE 100 is up 18 points or 0.3% at 6,278 - smaller gains than we saw earlier in the day when the FTSE was up more than 100 points at 6,371 at one point.
The pound’s gains against the dollar have also slowed, with sterling up 0.7% at $1.4810. It had hit a high of $1.4948 at one point on Thursday morning.
Updated
US manufacturing growth accelerates
More positive news on the US economy... this time from the manufacturing sector.
The headline index on Markit’s “flash” manufacturing PMI survey rose to a three-month of high of 51.4 in June, from 50.7 in May (where anything above 50 indicates expansion). Growth in exports was the main driver of growth.
It was better than expected, with economists forecasting 50.8 for the headline index combing output, new orders and employment.
Output in the sector grew modestly, and new business increased at an accelerated rate, boosted by the fastest pace in export sales since September 2014.
Chris Williamson, chief economist at Markit responded with caution to the better-than-expected PMI:
The flash PMI for June brought welcome news of improved performance of manufacturing, but the sector still looks to have acted as a drag on the economy in the second quarter, leaving the economy reliant on the service sector and consumers in particular to drive growth.
Any improvement could be largely traced to better export sales, in turn linked to the weakening of the dollar compared to earlier in the year. Domestic demand was again worryingly weak, especially from business customers, meaning overall growth of order books remained subdued.
Wall Street opens higher
US markets are up in early trading, echoing the upbeat sentiment in Europe.
- Dow Jones: +0.6% at 17,892
- S&P 500: +0.6% at 2,099
- Nasdaq: +0.8% at 4,872
US jobless claims lower than expected
Away from the markets, US jobless claims fell more sharply than expected last week according to figures from the Labor Department.
The number of new claims for unemployment benefits fell to 259,000 in the week ending 18 June, from 277,000 a week earlier. It was the biggest drop since February and close to a 43-year low touched in March.
Economists polled by Reuters were expecting a smaller drop to 270,000.
US #jobless claims fall to a near 43-year lowhttps://t.co/1xMol7sF8W
— Bernard Aw (@BernardAw_IG) June 23, 2016
Wall Street is expected to open higher:
US Opening Calls:#DOW 17928 +0.83%#SPX 2102 +0.84%#NASDAQ 4441 +0.84%#IGOpeningCall
— IGSquawk (@IGSquawk) June 23, 2016
On a lighter note, a horse named Brexit is taking to the turf at the Newbury racecourse tonight, at 6.10pm.
But it’s unlikely to triumph, with Betfair offering 12-1 odds on Brexit galloping home first.
I mentioned earlier that the cost of insuring against the pound either plunging or soaring overnight had soared.
That’s still true. But, the cost of insuring against wild swings over the next week has fallen. That suggests investors are less worried about a sterling crisis kicking off tomorrow.
#Brexit risk collapses... pic.twitter.com/wYopZ3e4u1
— jeroen blokland (@jsblokland) June 23, 2016
Amid today’s rally, some analysts are urging traders not to get carried away. Not a single vote has been counted yet.
Peter Rosenstreich, head of market strategy Swissquote Bank, says investors need to trade very carefully, and keep an eye on the North East city of Sunderland...
One of the earlier constituencies to declare a result should be Sunderland, viewed as a Brexit bellwether. Should Sunderland result in a close result or an outright majority vote to “remain”, then it is assumed that a “remain” vote will triumph.
By 05:00am BST, 80% of authorities are expected to have made their respective declarations, providing a clearer view of the outcome.
Foreign exchange group UKForex has seen a 100% increase in consumers making transfers from the pound into other currencies, in the last 24 hours.
The majority are transferring from sterling to euros.
William Shepherd, global head of treasury at UK Forex, says some customers are concerned that the cost of buying a European property could rocket if the pound drops tomorrow.
Shepherd explains:
“If the UK opts to leave, the pound could fall as much as 20%. Consumers could lose up to £1,398 on a £10,000 transfer, compared to today’s rate.”
David Cheetham of City firm XTB.com says the financial markets appear to have discounted the chance of Brexit over the last few days:
The price movements so far this week in financial markets suggest that a victory in today’s EU referendum for the leave camp has been given a very low probability, with the pound touching its highest level of the year against the US dollar this morning whilst the surge in the FTSE of late continues almost unabated.
Rather than heeding caution and remaining on the sidelines until this potentially major event risk has passed, traders appear to be betting on remain prevailing and are positioning accordingly.
Updated
Even the oil price is up this morning, as investors show more confidence about the global economy.
Brent crude is up 1.7%, back over $50 per barrel at $50.71.
Financial markets are playing Ode to Joy. Sterling up, FTSE up, oil up, "remain" up in final #EUref polls 🇪🇺🇬🇧
— Andrew Clark (@clarkaw) June 23, 2016
Here’s our latest news story on today’s market moves, by Katie Allen:
Pound not showing much response to noon Populus poll showing big remain lead. Looks like already priced in #EUref : pic.twitter.com/eiAYpg62zx
— Ben Chu (@BenChu_) June 23, 2016
Populus gives Remain 55%, Leave 45%
Another opinion poll just flashed up, also giving Remain the majority of support.
Populous reports that 55% of people surveyed want to stay in the EU, while 45% want to leave.
That’s the biggest gap recorded in the final flurry of polls before today’s vote, as polling expert Mike Smithson explains:
The final polling charthttps://t.co/EwJGsAhrDK pic.twitter.com/JHrzclug0Q
— Mike Smithson (@MSmithsonPB) June 23, 2016
The City isn’t waiting for the EU referendum result before piling into the pound.
Sterling just shy of $1.495 after Ipsos (4pt lead to remain) - Populus poll at 12. Could it hit $1.50 today? pic.twitter.com/gqoOuRZZhH
— Mike Bird (@Birdyword) June 23, 2016
Over at City firm ETX Capital, traders are getting ready for a referendum all-nighter.
Joe Rundle, head of trading, says:
“Whatever the result, it’s going to be a sleepless night for our traders as the results come in slowly on Friday morning. We’ll be fully staffed overnight to cope with the increased trading and volatility.
It’s an incredible opportunity for traders to make big bets on the fortunes of the pound and other markets affected by the referendum such as the FTSE.
A word of warning, however, as there could be some potentially wild gyrations in prices, particularly in sterling. Some banks are warning that they might fail to execute orders on their electronic trading platforms.
We’ve drawn up plans to deal with any increased volatility based on our positive experience of the Swiss franc turmoil last year, when the Swiss National Bank unpegged the currency from the euro.
Wowzers, the pound has now broken through $1.49 for the first time since the end of last December. That’s a gain of two whole cents today.
Pound jumps higher as Ipsos MORI poll give Remain the lead
Breaking: Ipsos MORI, the polling company, has just released its final opinion poll on the referendum.
And it shows that 52% of those surveyed wanted to stay in the European Union, against 48% who favour Leaving.
IMPORTANTLY, this is not an exit poll.
here it is 52% REmain and public expect Remain win pic.twitter.com/aF3hmmI17q
— Ben Page, Ipsos MORI (@benatipsosmori) June 23, 2016
That pushed the pound up to a new six-month high, of $1.488.
GBPUSD surging again on the Ipsos Mori poll pic.twitter.com/B6dspFlTOf
— World First (@World_First) June 23, 2016
The poll was conducted for the Evening Standard, who say:
The four-point gap is nail-bitingly close - especially with heavy rain threatening to dampen turnout in London which is a key target area for Remain.
Moreover, the research discloses that 12 per cent of people confess they might change their minds in the few hours left before they cast their vote, indicating how the historic decision has torn the country.
EXCLUSIVE: Remain secure narrow lead in final EU referendum poll https://t.co/1LxzpEWTwL pic.twitter.com/6QYKIrUayq
— Evening Standard (@standardnews) June 23, 2016
The higher shares rise today, the more they could fall tomorrow if Leave win.
FXTM research analyst Lukman Otunuga says:
With the EU referendum polling commencing on Thursday, market volatility may be set to amplify to untold levels as speculation heightens over the United Kingdom’s future in the European Union.
Although stock markets were offered a lifeline this week amid the “Bremain” optimism, most major stocks could be poised to decline lower if risk aversion and a potential “Brexit” encourages investors to scatter away from riskier assets.
Updated
Jeremy Cook of currency trading firm World First flags up that currency trading is pretty light today.
Many traders are keeping to the sidelines until the EU referendum result is known, to avoid being squashed by a fast-moving market.
Sterling liquidity thinner than a slim bag of spaghetti in a hall of mirrors
— World First (@World_First) June 23, 2016
The pound is on a real tear this morning....
Sterrrrrlinnnnnng pic.twitter.com/HuWbPWYrzx
— Mike Bird (@Birdyword) June 23, 2016
FTSE 100 hits two-month high, pound keeps rallying
Britain’s blue-chip FTSE 100 index has just hit its highest level in two month, as traders continue to watch today’s EU referendum unfold.
The Footsie jumped by 110 points to 6371 points, a gain of 1.5%. That’s its highest level since 21 April, before the EU referendum campaign came to the boil.
The pound has just hit a new 2016 high too, up 1.5 cents at $1.4862.
The rally is being led by mining companies, such as Glencore and Anglo American, who are particularly exposed to global economic demand.
Financial stocks, including Royal Bank of Scotland and Prudential, are also among the top risers.
Joshua Mahoney of City firm IG predicts more big swings before the day is out...
For all the posturing and emotive discussions that have taken place across homes, workplaces, TV studios and social media, the time has come for talk to turn into actions.
Amid restrictions to broadcasters, there is an eerie feeling in the city, with a nervous energy evident as we await the fate of the nation. Whatever the result, volatility is likely to be the name of the game.
Eurozone economic growth hits 17-month low
The latest eurozone economic data is in, and it’s not terribly good news.
Markit’s latest Purchasing Manager Index reports, which track activity across Europe, have come in weaker than expected.
The composite PMI fell to 52.8, from 53.1 in May. That’s a 17-month low, and closer to the 50-point mark showing stagnation.
Markit blamed “rising political uncertainty”; another sign that Brexit fears have hit economic growth.
It suggests Europe’s economic recovery is weakening, as Jack Kennedy, senior economist at Markit, explains:
“A renewed fall in new business was behind the decline, with respondents highlighting the difficulty of securing work amid a fragile demand environment.
“A flagging manufacturing sector was again the main source of weakness.”
Once again, Britain’s nearest European neighbour was a laggard. The French PMI slid to 49.4 from 50.9 in May, meaning its private sector is probably contracting.
After hitting its highest level of 2016 against the US dollar in early trading, the pound is now calmly bobbing around $1.477:
Referendum day is always good for photos, to fill the time before the results come in.
Our main EU referendum liveblog has a lot more:
Updated
Sterling is also a little higher against the euro this morning, at €1.3050 (up from €1.3015 overnight).
Although the pound has risen today, we should note that trading is pretty thin.
And traders will be trading blind until after 10pm tonight, when the polls close and we get an on-the-day poll from YouGov.
Yujiro Goto, currency strategist at Nomura, explains:
“If polls after the vote closes suggests that “Leave” is in front, then we could see sterling drop. These are very challenging conditions.”
Hussein Sayed, chief market strategist at FXTM, says traders seem to be influenced by the odds on offer at the bookmakers:
“Although most recent polls swayed toward the remain camp in the last couple of days, the lead is still very narrow, which doesn’t explain the surge in pound.
However, the markets are being completely reliant on the predictions from the bookies, which strongly expect “remain” to win the referendum.”
A little light music to guide you through the day....
The Brexit Referendum. As explained by the Smiths. https://t.co/Miid7GbRoK Your 6 song playlist for today.
— (((Duncan Weldon))) (@DuncanWeldon) June 23, 2016
European stock markets are mostly higher this morning, although there are no big moves.
There’s been a massive jump in the cost of insuring against sharp swings in the pound overnight.
“Sterling overnight implied volatility” - which basically measures the cost of hedging the pound – surged to levels not seen in many years (my data only goes back to 2008).
It shows that investors are covering themselves against the pound rallying strongly, or plunging, over the next 24 hours, as referendum results come in.
The pound has dipped back a little, as the rain pours down City trading floor windows.
It’s still up around 0.5% today, though, at $1.4763.
Sterling off a *bit*. I blame the rain.
— Katie Martin (@katie_martin_fx) June 23, 2016
FTSE 100 rises 0.7%
And we’re off ... trading has opened in London and the FTSE 100 is up just over 40 points, or 0.7%, at 6305 points.
Tesco is highest FTSE 100 riser, up 2%, after better-than-expected sales growth of 0.3% for its core UK supermarkets chain. This is the first time in more than five years that Britain’s biggest retailer has managed to produce two consecutive quarters of sales growth. It has also announced the sale of its Harris + Hoole coffee chain.
Updated
City traders may actually struggle to get to their desks on time, given the torrential rain and flooding problems in London and the South East.
Let’s hope they have understanding bosses.
Abellio Greater Anglia, South West Trains and Southern all warning of major delays on certain routes because of the flooding.
— LBC Breaking (@lbcbreaking) June 23, 2016
My colleague Alex Hern may need one...
It's not raining as hard as it was an hour ago, at least. Still a cop armed with a mop inside. pic.twitter.com/LHIC6YLLYL
— Alex Hern (@alexhern) June 23, 2016
Next problem: getting to work pic.twitter.com/sMKwopv2hb
— Alex Hern (@alexhern) June 23, 2016
Updated
Japan’s stock market had a decent enough day, closing more than one percent higher in the last session before Britain’s referendum.
Markets in risk-on mode as smart money bets on Bremain. #Japan's Nikkei jumps 1.1% to 16238.35 but Yen unchg. pic.twitter.com/0UYp3kw81u
— Holger Zschaepitz (@Schuldensuehner) June 23, 2016
City braces for referendum result
Britain’s financial institutions have taken some pretty serious steps to protect themselves against volatile markets over the next few days.
Our city editor Jill Treanor explains how investors will be setting up ‘war rooms’, ready to act as the referendum results start to come in....
Major banks are preparing for two days of unprecedented uncertainty by stuffing cash machines full of money, placing senior bankers on high alert in emergency war rooms around the City and switching off computer-driven “black box” trading systems to avoid incurring huge losses in violent swings in shares, bonds and currency markets.
With uncertainty about the precise moment the outcome of the EU referendumwill be known, dealing rooms are opening across the City on Thursday night and into Friday morning to allow trades to be executed for customers needing to respond to the results of the 382 polling areas as they start to be announced.
Unlike a general election, no exit polls have been commissioned by broadcasters and the first results are expected at 12.30am on Friday and then throughout the night. It is possible the result may not be known by the scheduled opening of the stock market at 8am on Friday morning.
Some banks have told investors that they will only conduct trading by taking verbal orders rather than through computers, while other banks are ready to override their algorithmic trading systems by closely monitoring them over night on Thursday....
Here’s a handy chart from the FT, showing how the pound has picked up:
Sterling edges back as UK polls open https://t.co/WWlyi8FdyO
— fastFT (@fastFT) June 23, 2016
Here’s our latest news story about the referendum:
Pound rallies in Asian trading
Sterling has hit its highest level against the US dollar this year, as traders in Asia watched events in the UK.
The pound hit $1.4844 against the US dollar for the first time in 2016, and is currently hovering around $1.48 in early London trading.
The move came after several opinion polls were released last night.
ComRes for the Daily Mail and ITV News put remain on 48%, leave on 42%. Excluding undecided voters, it found remain leading leave by 54% to 46%.
A YouGov gave remain a two-point cushion, ahead of leave by 51% to 49%.
However, a TNS poll released on Wednesday gave the advantage to leave, on 43%, with remain on 41% and 16% not decided or not voting at all.
And many analysts say that the race is simply too close to call.
Some forecasters have suggested the pound could hit 30-year lows in the event of a Brexit vote. Kit Juckes of French bank Societe Generale explains how it could rock global markets:
A decision to leave the EU is bad for global risk sentiment, good for the yen, and bad for sterling, the Euro and higher-beta currencies particularly central and Eastern European ones.
On a ‘Leave’ decision, we expect the pound to fall to $1.30-$1.35 quickly and we look for an eventual fall to $1.20-$1.25
Updated
The agenda: EU vote grips global markets
Good morning.
There’s only one important item on the agendas of investors across the world today. Britain is heading to the polls after a lengthy, bitterly fought campaign to decide if she stays in the European Union, or should leave.
Traders in the City are preparing for a lengthy shift - perhaps staying late into the night, or returning to the office early tomorrow morning.
Friday is likely to be one of the most dramatic and volatile trading sessions in many years, especially if the public choose to leave the EU. Analysts have predicted that the pound could slump by 15%, while shares would probably suffer big losses.
Voting has just begun, with pollsters saying that the result is hard to call - especially as around 10% voters are still undecided.
Turnout could be crucial, so it’s worth noting that it’s currently tipping it down in London (summer, eh?), causing flooding problems and traffic disruption:
Not great weather for a trip to the polling booth:
And also of note for #EUref, the weather is pretty awful so far today! Analysts have suggested this favours the Leave camp
— RANsquawk (@RANsquawk) June 23, 2016
Also coming up today:
Supermarket chain Tesco is reporting results, plus we get new eurozone manufacturing data this morning and US weekly jobless figures this afternoon.
But really, the markets will be nervously waiting for the results of today’s vote, in the early hours of tomorrow morning.
Updated
