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How to monitor the post Brexit market

Phil DeFrancesco
Phil DeFrancesco
Global Head of Trading Desktop

The U.K. Brexit vote to leave the European Union (EU) sent shockwaves through global markets and left the financial markets trying to figure out what is in store for the world’s economy.

The result was clearly not baked into the markets as the global exchanges, currencies and commodities all saw very volatile moves.

The choppiness is likely to continue for some time and traders need tools to help them stay on top of these moves most recently the triggering of Article 50. 

Here, we highlight how you can utilize Eikon to really stay on track with Brexit and other market developments.

First, to stay on top of the world markets, refer to the World Indices view (INOV) and the World Futures Indices view (INFOV).

Monitor Brexit markets product dashboard

Tracking securities

Our new Thin Monitor (MON) allows traders to customize which stocks, indices, currencies and commodities they want to track real time. Investors track commodities to gauge global sentiment of the overall economy.

For example, Gold (GCcv1) is always seen as a safe haven whenever there is unrest in the markets, and we saw Gold surge 4.6% on the day the Brexit news happened.

Copper (HGcv1) typically moves in tandem with overall market sentiment of the global economy, and we saw copper fall 2.4% that day. Crude (CLcv1) fell 5% as the vote ushered in a potential period of uncertainty for the global economy.

Investors may want to track currencies on their Monitor as well.  Here is a sample of what that could look like…

Monitor Brexit markets product dashboard

Our News app (NEWS) is something our users will certainly be using, and the Newsletter view (NEWSL) showcases our first class newsletter library.  Subscribe to any of the newsletters that are available simply by clicking the ‘subscribe’ button in the NEWSL view.

Another great way to monitor the global markets as well as which sectors are under/outperforming, is to use the Aggregates Matrix (AGGR) app.

The ‘out of the box’ templates are very useful and users can track performance by useful classifications such as region, country, market cap and sectors.

Monitor Brexit markets product dashboard

Create new ideas

Leveraging the power of StarMine within our Screener tool and our new Equity Risk Premium app (ERP) are great ways to create unique trade ideas and monitor country risk as the markets continue to fluctuate.

In regards to Brexit, investors could use Screener to locate companies whose ‘primary country of risk’ is the United Kingdom using the StarMine “Primary Country of Risk” metric.

The model uses “four sources of data, which are, in order of importance:  revenue distribution by geography, the location of a company’s headquarters, the country where its primary equity security listing trades, and financial reporting currency”.

This could be a great starting point for finding companies that could potentially be exposed to any economic downturn in the UK.

Monitor Brexit markets product dashboard 4

Effective charting

Charting is the lifeblood of investing as traders and portfolio managers look to enter and exit trade ideas at the most opportune times.

Using our classic charting app (CHT) is the best way to draw trend lines and perform other technical analysis on a security.  This is also a great time to check out our new Rebase chart (REBS).  Take a look. . .

Monitor Brexit markets product dashboard 5

Our Index Movers app (IMO) is a great visual for investors to use as they look to gather more in-depth information on what is driving the performance of a selected index.

Monitor Brexit markets product dashboard 6

Finally, using any of the Asset Class/World Overview pages could be a great starting point to get a quick snapshot of what is happening across the globe.

Some of the views I would like to highlight are: World Overview (WORLD OV), Financial Markets Overview (FMOV), Foreign Exchange Homepage (FXG), Precious Metals Homepage (METPREC) and the Equities Guide (EQG).

I hope this was helpful as we have now entered into a very volatile time that will impact the entire global marketplace. Eikon can hold the answer to the next big trade idea and help make things a little easier in these times of unrest.

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This material is provided for as market commentary and for educational purposes only and does not constitute investment research or advice. The information contained herein is based on current tax laws, which may change in the future. We cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided in this publication or from any other source mentioned. The information provided in these materials does not constitute any legal, tax or accounting advice. Please consult with a qualified professional for this type of advice.