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UK Services PMI has risen by the 5.5 points to 52.9, the biggest ever jump in the survey’s 20 year history.

The rise is a sharp bounce back from the 47.4 reading taken in July in the immediate aftermath of the EU referendum.

The pound jumped almost a cent against the dollar on the back of the news.

Laith Khalaf, Senior Analyst at Hargreaves Lansdown comments:

‘The service sector is the engine room of the UK economy, so a return to form represents a welcome vote of confidence in the country’s financial prospects. With parliament now back from summer holidays, the serious business of negotiating withdrawal from the EU begins in earnest. Brexit is going to be a lengthy process, with plenty of ups and downs along the way, so economically speaking it’s still way too early to start counting any chickens just yet.

It’s also worth bearing in mind that dramatic bounce-backs are often a reflection of the depths of previous despair, rather than of optimism over the future. In terms of services output, today’s reading is simply in line with survey results earlier in the year, and it is last month’s sharply negative reading which is the outlier.

Since the referendum economic indicators have by and large held up pretty well, and if the positive mood music continues that should put a spring in the step of the pound on the currency markets. More robust economic data would also make the central bank think twice about any further loosening of monetary policy, and may also play its part in determining the future of austerity, as we approach the new chancellor’s Autumn Statement later on in the year.’

(Source: Hargreaves Lansdown)

Hours after the EU Referundum results were revealed, UK Head of Banking and Capital Markets at PwC Simon Hunt comments on the impact that Brexit will have on the banking sector in the country.

The UK is one of the world’s leading financial centres. The banking sector plays a major part in generating exports of £23bn to the EU, which helps to drive an overall trade surplus in financial services of £20bn. Retaining this position is the challenge that banks and all stakeholders may now have to consider.
One of the most significant benefits of EU membership to the banking sector is the ability to access the Single Market via the passporting regime and the loss of passporting benefits would have an impact on the ability of banks authorised in the UK to offer products and services for EU clients.

This impact will not be limited to the UK headquartered banks but will also impact non-EU headquartered banks who have used the UK as a base for their European operations.

Overseas banks currently using the UK as a base for accessing the EU market and employing an estimated 115000 staff are likely to be looking closely at their operations in the UK in the context of the leave vote. Find the best PIA Reservation from Pakistan to anywhere in the World with Malik Express.

The result of the vote does not represent the end of the debate that has impacted markets in recent months. Months, and possibly years, of negotiation will now follow before banking organisations will have clarity on what access UK-based FS organisations will have to EU countries or the rules they must comply with to secure this access.

We are already starting to see the short-term impact on the market as efforts are made to reinforce confidence in the UK banking sector. However, history has taught us that UK business is adaptable and the banking sector is one of our strongest industries and will continue to make a major contribution to the UK economy.  Collectively, the financial services sector accounts for 8% of total UK economic activity and directly employs 1.1 million people - around 3.6% of the total UK workforce, generating income, investment and exports.

This result could be taken as a major opportunity for banks to work with regulators, investors and clients in order to shape a new rulebook fit for the new climate.

(Source: PwC)

After a night of counting the votes, it was revealed at exactly 06:00 BST this morning that Britain had voted to leave the EU. Prime Minister David Cameron has announced that he is stepping down by October, saying:

“I fought this campaign in the only way I know how – which is to say directly and passionately what I think and feel- head, heart and soul. I held nothing back. I was absolutely clear about my belief that Britain is stronger, safer and better off inside the European Union. And I made clear that the Referendum was about this and this alone – not the future of any single politician, including myself. But the British people have made a very clear decision to take a different path. And as such, I think that the country requires fresh leadership to take it in this direction. “

The referendum has seen the highest turnout at a UK-wide vote since 1992 – 71.8% with more than 30 million people voting. 51.9 % of those voted to Leave by 48.1%. While England and Wales voted strongly for Britain to leave the EU, London, Scotland and Northern Ireland strongly disagreed with Brexit.

UKIP Leader Nigel Farage, who has been campaigning for Britain to leave the EU in the past two decades, said that today would “go down in history as our independence day”.

As the UK heads for Brexit, the pound has fallen dramatically hitting a 30-year low and plummeting to $1.3236 at one stage earlier this morning. In the opening minutes of trade, the FTSE 100 Index fell more than 500 points before regaining some ground.

Laith Khalaf, Senior Analyst at Hargreaves Lansdown comments: ‘Global stock markets have taken a Brexit hit, with European markets actually falling more than the Footsie. Safe haven assets have soared as investors sought security, with gold rising 5% and UK bond yields plunging to historic lows.On the stock market, banks and housebuilders have been hit particularly hard this morning as markets try to factor in the Brexit effect on the UK economy.Sterling has fallen to its lowest level for over 30 years , which will mean holidaymakers heading abroad in the coming weeks will have to dig extra deep to buy foreign currency.Investors should carefully consider their plans and avoid a knee-jerk reaction. The coming days are likely to be choppy on the stock market as it digests the ramifications of Brexit, and further falls are possible.However markets will bounce back at some point, and investors who switch to cash risk buying back into the market at a higher level, and ending up in a worse position than if they had just stayed put.’

Bank of England governor Mark Carney said this morning that: "Some market and economic volatility can be expected as this process unfold. But we are well prepared for this. The Treasury and the Bank of England have engaged in extensive contingency planning and the Chancellor and I have been in close contact, including through the night and this morning.

"The Bank will not hesitate to take additional measures as required as markets adjust and the UK economy moves forward."

As the Article 50 two-year deadline approaches following the referendum results, David Cameron will be put under pressure to "steady the ship" over the coming weeks. Remain campaigners believe that it is possible that the Brexit could result in reverting to trading with the EU under World Trade Organization rules, which would involve exporters being hit by import taxes or tariffs.

After all 32 local authority areas in Scotland returned majorities for Remain, Scotland's First Minister Nicola Sturgeon has said that the referendum results make it “clear that the people of Scotland see their future as part of the European Union".

Germany's foreign minister Frank Walter Steinmeier commented that today is "a sad day for Europe and Great Britain".

British citizens go to the polls today voting in a historic referendum which will decide Britain’s future. According to provisional figures from the Electoral Commission, 46, 499, 537 people are entitled to take part in today’s referendum in the UK and Gibraltar – the highest number of voters ever recorded for a UK election. Polling stations opened at 07:00 BST and will close at 22:00 BST. Once the polling stations close, sealed ballot boxes will be transported to the count venues to each of the local counting areas, which include 38 local government areas in England, Scotland, Wales, and 2 in Northern Ireland and Gibraltar. The final result is expected to be revealed on Friday morning according to the Electoral Commission.

Traditionally, turnout in referendums is low – only 42 % of the population voted on a proposed new electoral system in 2011. However, analysts predict that the high-profile campaigning from the past four months is highly likely to boost figures.

Mixed predictions were offered by a final rash of polls – with two putting Leave ahead and two suggesting leads for Remain. YouGov research predicts that people supporting the Leave campaign are more likely to vote, which means that a low turnout could damage the Remain campaign’s prospects.

Politicians supporting both sides made final pitches yesterday as polls predicted the result is on a knife-edge on the final day of campaigning before the vote. PM David Cameron told supporters in Birmingham that “It is a fact that our economy will be weaker if we leave and stronger if we stay”.

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