The day after Brexit: Remembering a chaotic day in the markets one year ago

A trader from BGC, a global brokerage company in London’s Canary Wharf financial centre reacts during trading June 24, 2016 after Britain voted to leave the European Union in the EU BREXIT referendum.Reuters/Russell Boyce

LONDON — One year ago today, having gone to bed with rain pouring down outside, Brits awoke to glorious sunshine — and the news that they’d voted to leave the European Union.

What followed on Friday, June 24, 2016, was a day of political and financial chaos unprecedented in Europe since the heart of the global financial crisis. Markets around the world crashed, investors flooded into safe havens like gold, and panic spread.

Business Insider took a look back at one of the wildest days in recent markets history. Check out a handful of the biggest movements and scariest moments:

The pound crashes to a 31-year low

Sterling dived off a cliff, losing around 3% of its value, after early morning results show the northern city of Sunderland voting more heavily for Brexit than had been expected. Up until this point, most had expected the Remain campaign to win but Sunderland’s voting pattern was taken as a sign that the Leave campaign could clinch it.

As more results rolled in, the pound continued to tank and lost more than 10% of its value at its lowest point. By the end of the day, the currency had recovered a little and was down 8% or so to trade close to $1.36.

It would be the biggest single day fall for a major currency since the Second World War.Investing.com

“All necessary steps”

At 7.00 a.m, as Brits are starting to wake up, the Bank of England issues a statement saying it is willing to take “all necessary steps” to fulfil its responsibilities and safeguard the UK in an attempt to calm crazy volatility in the markets.

“The Bank of England is monitoring developments closely. It has undertaken extensive contingency planning and is working closely with HM Treasury, other domestic authorities and overseas central banks,” it said.

“The Bank of England will take all necessary steps to meet its responsibilities for monetary and financial stability.”

Later in the morning, Governor Mark Carney would give a speech reassuring investors and saying that the Bank was “ready to provide more £250 billion of additional capital to its normal operations.”

The FTSE 100 drops like a stone

Britain’s benchmark share index, the FTSE 100 plunges more than 500 points as the markets open.

European stocks crashed in a straight line at the open. There were fears that falls were so big that the London Stock Exchange would halt trading as automatic circuit breakers were triggered.

The index gradually recovered over the course of the day and has gained 17% in the year since the result.Investing.com

Banking stocks were the biggest victims of the early morning stock market crash, with the likes of RBS, Barclays, and Lloyds losing in excess of 30% of their market value in a matter of seconds.

Contagion spread across the globe with US stock futures tanking, and bourses all around Europe witnessing enormous losses. Germany’s DAX ended the day 6.8% lower, while France’s CAC was close to 8% down at the close.

Bank CEOs react

Goldman Sachs CEO Lloyd Blankfein told his staff there was “no immediate change to the way we conduct our business,” while JPMorgan’s Jamie Dimon said: “There are no changes to the structure of our clients’ relationships with JPMorgan Chase or their ability to work with our firm.”

In the UK, Barclays CEO Jes Staley told employees that he did “not pretend to have all the answers” after the vote and Lloyds boss Antonio Horta-Osorio moved to reassure staff that the bank’s contingency plans in event of a Brexit were being activated.

Gold goes bananas

The price of gold jumps more than 5% as investors looked for the safety provided by the physical presence of the precious metal. Analysts project that gold’s rally will continue.

“The argument for a gold rally is straightforward,” said James Steel, chief precious metals analyst at HSBC. “The uncertainty spurred by this vote will likely elicit sufficient gold purchases to buoy prices. The link is the interconnection between gold and wider financial markets.”