The daily business briefing: June 24, 2016

The UK votes to leave the EU, U.S. stock futures dive after Brexit vote, and more

In or out logos on Brexit mugs
(Image credit: Dan Kitwood/Getty Images)

1. Britain votes to exit the EU

The UK voted Thursday to leave the European Union, sending the British pound and global stocks plunging. Prime Minister David Cameron, who led the campaign to stay in the 28-nation trading bloc, announced that he would resign by October after the "Leave" campaign won by an unexpectedly strong 52 percent to 48 percent. European Council President Donald Tusk called for resisting "hysterical reactions" as the UK prepares for a two-year process of leaving the EU. Leading Brexit advocates said the vote restored UK independence after the EU's mishandling of the financial crisis and a mass influx of refugees.

The New York Times Reuters

2. U.S. stocks head for sharp drop after Brexit vote

U.S. stock futures plummeted early Friday after the UK voted to leave the European Union. Dow Jones Industrial Average futures plunged by as much as 700 points before regaining some of the losses, but remained down by 485 points, or 2.7 percent, suggesting a sharp decline at the start of trading. S&P 500 futures were down even more, falling 80 points or 3.7 percent, with Nasdaq-100 futures falling by 3.9 percent. A day earlier markets had rallied as the last polls before the referendum suggested voters would reject the Brexit.

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3. VW agrees to pay $10 billion to owners of cars affected by emissions scandal

Volkswagen has agreed to pay more than $10 billion to settle with nearly 500,000 U.S. customers affected by its diesel emissions cheating scandal, The Wall Street Journal reported Thursday. The company, which has admitted installing software capable of sidestepping diesel emissions tests, will pay owners at least $5,100 on top of the cost of buying back the vehicles or repairing them to make them compliant with environmental regulations.

4. Nation's biggest banks pass Fed stress test

The 33 largest U.S. financial institutions passed the Federal Reserve's annual stress test, the Fed announced Thursday. The passing marks indicate that the banks, including JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo, all hold more capital than they did a year ago, boosting their ability to survive another financial crisis. The tests were created after the financial and housing crisis of 2008 and 2009, during which the federal government had to bail out many financial institutions.

USA Today The Associated Press

5. Jobless claims fall

The number of Americans filing for unemployment benefits fell last week by 18,000 to 259,000, near a 43-year low touched in April. Economists had expected first-time claims to fall only to 270,000. The four-week moving average of claims — a better indicator of the health of the labor market — fell by 2,250 to 267,000, its lowest level since April. The latest figures show that the disappointing May jobs report "greatly exaggerated the extent to which the trend in employment growth is weakening," said Jim O'Sullivan, chief U.S. economist at High Frequency Economics.


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