State Street announced its latest Brexometer research, measuring the sentiment of institutional investors in relation to Brexit developments. The research revealed that two-thirds (66 percent) of institutional investors believe the UK leaving the European Union without a deal on October 31 will have a negative impact on global markets, with almost one in three (31 percent) expecting “serious implications”.
If the UK secures an agreement before the set deadline, however, then 71 percent of institutional investors expect this to have a positive impact on markets. But if an extension is agreed that results in a general election and/or a second referendum in the UK, 43 percent of institutional investors think global markets would react negatively to the level of continued uncertainty this would create. This is compared to less than one third (32 percent) who think the opposite.
“It’s no surprise that Brexit is having a significant impact on global markets, and whilst a confirmed decision is unlikely until the eleventh hour, the vast majority of our clients have factored in the different scenarios to their investments and business models,” said Jörg Ambrosius, head of Europe, Middle-East and Africa at State Street. “Instead, what the industry will be looking at now is how these contingency plans fair in weathering the Brexit storm. Despite all this uncertainty, we continue to be well-positioned and dedicated to being our clients’ essential partner.”