Why did the US stock market collapse when the UK decides to leave the EU?
For those who are financial savvy, can you explain why our stock market dropped 600 points when the UK voted to leave the EU?
I was under the impression that the EU was formed to strength the European nations in trade with the rest of the world. If a weaker EU results, would that be a good thing for America and the Far East?
United States' goods trade in foreign markets. When the Euro and the English Pound plummet that makes the US Dollar worth more comparatively. While this is good if you are a US tourist because your dollar goes further it is bad if you are a manufacturer selling goods abroad. This is because US goods will cost more to EU and British consumers which could inevitably mean the US sells less goods.
Plus the United States has a lot of ties to financial institutions and businesses in England so economic issues over there still ripple here and visa versa and not necessarily things that can be felt in isolation.
It would be more important to know why they didn't shut down the stock market when the news came out. It was supposed to be one of the safeguards to provide a cooling off period.
Trading curb will only kick in at 7%, 13% and 20% loss.
That should be something to change, because right now it is doom and gloom no matter the percentage. Yesterday was 5.4%. 5% sounds like a good number for a one day loss. the stock market learned nothing from 2008. What is your guess for Mon %s?
I think all this turmoil is orchestrated. The net effect on our stock market should be zero. This down turn is a good buying opportunity. The market will return to normal in a week or so.
I truly agree with that. The media is making a circus of it. The stock market is filled with ducks, and a few hawks to chase them. The stock market needed a correction anyway, now they have one.
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