Market Update: Where are we Post-Brexit?

The results of Markit’s recent PMI (the Purchasing Managers Index) survey has the put the minds of the British public at ease (for now) as the unexpected rebound of the service sector adds to a string of positive market news on exports, jobs and houses.

Markit recorded the biggest month on month increase in the survey’s history and shows figures increasing from 47.4 in July to 52.9, far exceeding the 50 mark needed for growth.The service sector makes up a staggering 80% of the UK economy

 

From these results it is now clear that Britain will avoid the expected recession many thought would follow after the June's historic vote.

"The services PMI completes a triple-whammy of good economic data for the UK in the last three trading sessions and indicates that businesses are returning to normal after the initial shock of the vote rocked confidence," said Neil Wilson, a financial market analyst at ETX Capital.

 

Britain’s economic situation is looking brighter with the value of the pound going up on a seven week high against the value of the dollar - $1.3375, and the value of the pound beginning to steady.

Credit Suisse and Morgan Stanley have both 'rowed back' on their predictions after the better than expected results. Bank of England Governor, Mark Carney, has described himself as feeling 'absolutely serene' with the banks preparations and actions which he says allowed Britain's economy to 'sail through' the shock impact following the referendum.
 

The City of London, however, is not sitting on its hands and has already stepped up lobbying efforts with the new Chancellor Philip Hammond to ensure that processes are not rushed and to stress the importance of access to the single market. The Financial Services industry accounts for more than 12% of the UK's exports, contributing £60 billion in tax and employing 1 million people.

How are the Big Four after the Brexit vote?

Deloitte

Deloitte’s UK revenues have grown at the fastest rate in a decade, according the latest figures.The company experienced a “landmark” year in Scotland, strengthened its Transaction Services practice in the North of England and Group revenue for Deloitte has increased by 11.2 per cent for the year to May 2016 to £3.1bn.

Managing Partner, David Sproul, has suggested that the government should not reduce hiring skilled migrants: “The government must recognise that further restricting skilled migrants could be detrimental to the UK’s ability to attract global investment and the diverse pool of international talent that has supported our country’s growth”.
 

KPMG
 

KPMG continues to be the preferred UK's auditor for stock market clients, having created six new contracts in the last quarter. The Head of KPMG's deal advisory practice in the Midlands has stated that there is still a healthy appetite for deals in the region describing the environment as conducive.  

 

PWC
 

PWC remains in second place behind KPMG with 369 total clients and has come out confidently stating that London's dynamism means that it would remain agile and resilient to any potential fallout from Brexit and that the City had managed to  'pull away' from other global rivals this year.
 

EY
 

 EY has noted the opportunities for businesses that will come as a result of any renogiations and has stated that due to UK's strong performance in the past year it has retained it's spot as the number one place in Europe for foreign investment.

 

The future is looking a lot brighter than many experts initially thought, we now await to see how the new government intends to take Britain forward.
 

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