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Index IDEA: UK equities keep calm and carry on after UK referendum

Despite well publicized fears about the future viability of the UK market and economy after UK citizens voted to leave the European Union on June 23, UK equity markets as measured by the FTSE 100 and FTSE 250 Indexes have proven resilient in the four months since the referendum results were announced.

And, as the value of the British pound relative to many other global currencies has weakened in recent months, indexes based on the British pound have had the strongest performance relative to those based on the US dollar and the Euro.

The value of the FTSE 100 Index, which measures the performance of the 100 most highly capitalized companies listed on the London Stock Exchange (when denominated in the British pound) has risen 15.8% year-to-date and 15.1% since the results of the UK referendum vote were announced through October 24.

The FTSE 250 Index, which measures mid-capitalization companies not covered by the FTSE 100 and representing approximately 15% of UK equity market capitalization, has risen 5% in value year-to-date and 12.1% in value since the results of the UK referendum vote were announced on June 24 through October 24.
 

Tom Goodwin, Senior Index Research Director, FTSE Russell:

“The FTSE 100 and FTSE 250 Indexes demonstrate three important market trends since the Brexit vote: the solid performance of the pound-based indexes, the negative performance of euro and dollar-based indexes, and the contrast between the multinational-tilted FTSE 100 and the domestic-tilted FTSE 250. The post-Brexit UK market performance example helps illustrate how high quality market indexes can help market participants better understand changing dynamics along with the role currency movements can play.“

 

For additional informatoin see the FTSE UK Index Series.


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