Monday, June 27, 2016

Brexit and the Markets

The question for the market this week is: What effect will Brexit - the British exit from the European Union -  continue to have? Friday was a bloodbath: Both the large-cap and the blue-chip U.S. indexes had their worst session since last August.

By the end of the day the S&P 500 had lost 3.6 percent of its value, and the Dow Jones Industrial Average lost 3.4 percent. The Nasdaq Composite Index fell by 4.1 percent, its worst one-day percentage drop since August 2011.

As for this week? The CBOE Market Volatility Index, which gauges the level of fear in the financial markets, skyrocketed 49 percent on Friday, notching its biggest one-day percentage gain since August of 2011. But remember, that measures expected market movement - which could be either positive or negative.

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