Global stocks slide on Brexit fears as investors seek safety

Fri Jun 10, 2016 6:37pm EDT
 
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By Saqib Iqbal Ahmed

NEW YORK (Reuters) - Investors swapped equities for less risky assets such as U.S. Treasuries and the yen on Friday on fears about the impact of Britain's June 23 referendum on whether it should leave the European Union.

An index of world equity markets suffered its worst day in four months after having snapped a five-day winning streak on Thursday, while oil prices slid and were off 2016 highs hit this week due to a stronger dollar.

U.S. Treasury yields, which move inversely to prices, fell to four-month lows as European sovereign debt yields plunged on continuing concerns about global growth and a potential British exit from the EU.

Though bookmakers' odds point towards a vote to stay in the EU, polls suggest a neck-and-neck race.

Ten-year yields in Germany, Japan and Britain all struck record lows.

"It really is the risk-off trade today," said Eric Wiegand, senior portfolio manager at U.S. Bank's Private Client Reserve in New York.

Investors ditched stocks in favor of assets considered safer during times of economic uncertainty, such as bonds, gold, and the yen.

Wall Street followed the lead of Asian and European stocks to fall for a second straight day, with the energy sector hit the hardest.   Continued...

 
People walk through the lobby of the London Stock Exchange in London, Britain November 30, 2015. REUTERS/Suzanne Plunkett