Comment: Brexit - finally some clarity

Michael Livijn, Chief Investment Strategist.
19-12-13 10:25 | Markets and investments

The election yesterday in the UK offered something that has been a rarity during the three-year-long soap opera called Brexit: some clarity. British voters gave the conservatives (Tories), led by Prime Minister Boris Johnson, a clear mandate to go through with a Brexit as exit polls indicated 368 of 650 seats for the party.

For Johnson, this means gaining an absolute majority as well as the possibility to secure a fast Brexit. Since he already has a deal ready to present to the parliament. The markets reacted immediately to the news and the British pound soared on the result.

Graph GBP since the Brexit referendum

The next step after the exit on 31 January will be negotiations about future ties with the European Union, in other words the actual divorce. Based on past experiences we don’t expect this to be a walk in the park, thus leaving some continued political risk surrounding the issue.

However, relative to the situation yesterday, the risk level has decreased markedly., leading to forecasts for Europe and European shares looking brighter. The slow down in the region has mainly affected the manufacturing sector but there have been some signs of a stabilization in the past months. With a straighter Brexit path ahead and yesterday’s trade agreement between the US and China, Europe should start looking more attractive to investors, who have been exiting the region en masse since 2016. We are keeping our overweight stance on European shares.

Read more news

Showing 5 of 786 results

Nordea named Best Private Bank in Norway, Sweden and Denmark

About Nordea

Nordea won the awards for Best Private Bank in Norway, Sweden and Denmark when Global Finance named the world’s best private banks 2021

New survey: Treasuries in 2025

Businesses Digital banking

The results of Nordea’s newly released ‘Treasury 2025’ survey show four out of five corporate treasury functions expect to be strongly involved in the strate...

Eric Pedersen

Nordea Asset Management signs letter against construction of coal-fired plant in Vietnam

Sustainability Markets and investments

A consortium of investors has signed a letter to financial institutions and companies involved in the construction of the coal plant Vung Ang 2 in Vietnam.

CEO Frank Vang-Jensen

CEO blog: Strong result and continued improvements

About Nordea

Today we published our financial results for the third quarter

Showing 5 of 786 results