Brexit aftermath, Spain returns to polls and Fallujah freed

Sign up to receive FirstFT by email here

Brexit chaos continued in London on Monday. The British pound and equities slid while haven assets such as Gilts and gold surged, as investors continued to fret about the UK’s decision to leave the EU.

After staying out of sight over the weekend, George Osborne, the UK chancellor tried to reassure markets ahead of their opening on Monday. He acknowledged that the result of the referendum was “not the outcome that I wanted” but added that authorities were “ready to deal with the consequences”.

Meanwhile, Boris Johnson, Leave campaigner and favourite to succeed prime minister David Cameron as prime minister, also tried to put a positive spin on events: “It is clear now that ‘project fear’ is over . . . people’s pensions are safe, the pound is stable, markets are stable, I think that is all very good news.” This comes the day after he penned a column in which he suddenly appeared to be a pro-European: “I cannot stress too much that Britain is part of Europe, and always will be.”

The UK may be facing up to a future of waning influence on the global stage, but Wolfgang Münchau argues that the real victim of Brexit is Europe. (FT)

Follow the latest developments on Brexit with our live blog.

In the news

Five key takeaways from the Spanish elections The ballot offered voters the chance to break the country’s protracted political deadlock, but the final result pointed towards another fragmented parliament. Prime minister Mariano Rajoy will once again have the biggest bloc in the legislature, and indeed managed to extend his lead over the opposition. But it remains unclear when, how and with whom he can form a governing coalition. (FT)

Europe tightens defence integration Even as the UK votes to leave the union, Brussels is to push for multinational headquarters, military procurement and deployments to better project its foreign policy clout. (FT)

Iraq says battle for Fallujah is ‘over’ Iraqi forces liberated the city from the jihadi group, with an Iraqi commander leading the fight declaring the battle "over" after government forces entered the last Isis stronghold there. (FT)

Israel and Turkey put aside six years of enmity and restored relations that were ruptured when an Israeli raid killed 10 Turkish activists trying to break a blockade on the Gaza Strip. The deal will help Israel find buyers for its offshore gas exports and will help Ankara restore its battered regional influence.

Chinese steelmakers consider merger In the face of industry overcapacity, Baosteel and Wuhan are looking at a “joint restructuring”. If successful, the group would rival AcelorMittal, the world’s largest steelmaker. (FT)

AIIB and China’s global ambitions China’s newest development bank is poised to extend its lending activities beyond Asia to Africa and Latin America, underscoring the Chinese government’s international ambitions at a time when globalisation is fuelling a populist backlash in the west. (FT)

Russia and China secure energy deals The two countries sealed a series of energy deals during President Vladimir Putin's visit to Beijing. (Reuters)

It’s a big day for

The future of Britain and the EU German chancellor Angela Merkel will host Donald Tusk, European Council president, in Berlin to talk about Brexit, and will later meet France's François Hollande and Italy's Matteo Renzi. The German leader has already pushed back against EU pressure to rush Britain's departure. (FT) 

Abortion rights in the US The Supreme Court is set to issue its first major abortion ruling since 2007 amid a volatile election season. (Reuters) 

Food for thought

Can Brexit be stopped? Millions who voted to remain are asking themselves this question. Petitions are circulating on social media and demonstrations are being planned. But while leaving the EU may be hard, so is defying those who voted to leave. (FT)

But Michael Stott thinks there is still a chance of saving Britain from Brexit. He points out that the referendum is not legally binding, and that fewer than 40% of the electorate chose to leave the EU. All that’s required to prevent the rupture is calm heads and clear minds on both side of the Channel. (NAR)

US conservatives hear the British lion roar and project their own election hopes on to the UK’s vote to leave the EU, says the FT’s Ed Luce. Hillary Clinton’s campaign should pay attention if it wants to avoid David Cameron’s mistakes.

Workplaces are uncivil Office life has become uncivil as workers fire off emails and fiddle with smartphones rather than answering their phones or listening to colleagues. (FT)

Republicans act to stop Trump opponents The Trump campaign and the Republican National Committee are moving to head off the fledgling effort to stage a revolt at their convention next month, hoping to prevent an embarrassing spectacle that could deeply wound the presumptive nominee. (NYT) Keep track of the 2016 race with the FT's daily US politics newsletter. Sign up here.

Video of the day

What investors should watch post-Brexit On the first full trading day since the UK voted to leave the EU, the FT’s Jennifer Hughes says investors should watch gold, the yen, sterling and the FTSE 250. (FT)