A First Look at BREXIT and Global Equity Markets

13 Pages Posted: 10 Aug 2017

See all articles by Richard C. K. Burdekin

Richard C. K. Burdekin

Claremont McKenna College - Robert Day School of Economics and Finance

Eric N. Hughson

Claremont McKenna College - Robert Day School of Economics and Finance

Marc Weidenmier

Claremont McKenna College - Robert Day School of Economics and Finance; National Bureau of Economic Research (NBER)

Jinlin Gu

Claremont Colleges, Claremont McKenna College, Robert Day School of Economics and Finance, Students

Multiple version iconThere are 2 versions of this paper

Date Written: July 17, 2016

Abstract

Global equity markets experienced a significantly negative return of over 4.7 percent on June 24, 2016 in response to news of Britain’s decision (BREXIT) to leave the European Union. Stock market indices for members of the European Union were hard hit with nearly all experiencing significantly negative additional abnormal returns. Large economies such as Germany, Britain and France experienced abnormal returns of -3 to -4.2 percent while the so-called PIIGS: Portugal, Ireland, Italy, Greece, and Spain fared even worse, experiencing abnormal returns of up to negative 10 percent (Greece). We find positive abnormal returns in some BRICS nations.

Keywords: Brexit, Global Stock Returns, Event Study

JEL Classification: F30, G15

Suggested Citation

Burdekin, Richard C. K. and Hughson, Eric N. and Weidenmier, Marc D. and Gu, Jinlin, A First Look at BREXIT and Global Equity Markets (July 17, 2016). Available at SSRN: https://ssrn.com/abstract=2810879 or http://dx.doi.org/10.2139/ssrn.2810879

Richard C. K. Burdekin

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth Street
Claremont, CA 91711
United States

Eric N. Hughson (Contact Author)

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States
909-607-3664 (Phone)

Marc D. Weidenmier

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Jinlin Gu

Claremont Colleges, Claremont McKenna College, Robert Day School of Economics and Finance, Students ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States

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