UK votes to leave EU, prime minister to resign, markets in turmoil

Britain has voted to leave the EU in a popular revolt that has caused the prime minister David Cameron to announce his resignation and sent shockwaves through financial markets around the world.

With the vote going against market expectations, the pound dived to a 30-year low, and London and Asian stock markets plunged. Money poured into “safe havens” such as gold. The Bank of England’s governor moved to the calm the markets with assurances on monetary and financial stability.

The vote revealed deep divisions across Britain, with prosperous Scotland and London voting by large margins for Remain, while working-class towns, seaside resorts and rural England swung heavily for Leave. The vote has put secession for Scotland back on the agenda and will increase pressure for referendums in other countries such as the Netherlands and France.

When negotiations to leave the EU begin, they will entail re-engineering the world’s biggest single market, setting new terms of access and legislating to “renationalise” law rooted in the EU. Britain will negotiate under a new prime minister, with a leader to be chosen by the Conservative party by the time of its annual conference in October. (FT, Scotsman)

Brexit briefing 

Read full FT coverage on our special landing page.

Five consequences of Brexit, analysed by Tony Barber. 

Cameron’s legacy The British prime minister will be remembered as the man who gambled the nation’s future on an attempt to appease his own party, says Philip Stephens.

Uncertain future Martin Wolf writes that Boris Johnson and Michael Gove, the rising powers in the UK, must now rely on the experts whose advice they scorned during the referendum campaign. “The UK is now at the beginning of an extended period of uncertainty that, in overwhelming probability, foreshadows a diminished future.”

Hear the FT’s perspective at a Post-Referendum Briefing next Monday with senior editors and columnists. 

In the news

Supreme Court deals immigration blow to Obama The top court maintained a freeze on the White House’s efforts to protect millions of people from deportation. The result imperils what the president hoped would be a central part of his legacy, a plan to shield nearly 4m unauthorised immigrants. (FT)

Congressional Democrats end gun control sit-in More than 200 Democrats, led by civil rights icon Congressman John Lewis, had occupied the floor of the House since Wednesday in a dramatic protest over Republicans’ refusal to hold a vote on a bill limiting access to firearms for those on no-fly lists. (FT)

Banks pass stress tests The US banking system has the financial strength to withstand an economic meltdown — and negative US interest rates — after improving defences since the 2008 crisis, regulators said. (FT)

VW to pay over $10bn for US emissions scandal The German carmaker will pay nearly $10.3bn to settle claims by US regulators stemming from the diesel emissions cheating scandal, according to an unnamed source. Meanwhile, investor advisory bodies are planning to ask a German court to appoint an independent expert to lead an investigation into whether Volkswagen’s top managers and directors played any role in the scandal. (Reuters, FT)

The tune will come to you at last Led Zeppelin has fended off a lawsuit that claimed the band had stolen the iconic guitar riff from “Stairway to Heaven” from a lesser-known group called Spirit. (FT)

Gunman shot dead after storming German cinema The incident took place in the small town of Viernheim, south of Frankfurt. The attacker had appeared “confused” and was overpowered by police special forces. (FT)

It’s a big day for

Donald Trump in Scotland where the presumptive Republican presidential nominee is reopening the Turnberry golf course after a £200m renovation project. Arriving there this morning, he welcomed Britain’s vote to leave the EU, saying “the UK took back control, it was a great thing”. (FT)

Indicators of post-Brexit Britain By January 2017 it will be clear whether the UK economy has been pushed into formal recession or has successfully ridden out the shock. (FT)

Food for thought

Martin Wolf: legalise it, man Our chief economics commentator is a bit more sober and nuanced about the whole thing, but he argues that the war on drugs is a fatuous idea. “Criminalisation is a dreadful mistake. This is not because drugs are harmless but rather because they are harmful. Containing harm and promoting health are indeed the only sane approach.” (FT)

Fly at the front for a fraction of the cost Insider tips on how to play the frequent flyer game with aplomb, from the people who fly first-class to five-star hotels for free. (FT)

Sanders' social media smarts When a bird landed on his lectern mid-speech, Bernie Sanders' digital media team pushed out the video and created animated graphics of the candidate and his new friend. The campaign raised $3.6m in just a few days, all of it from online donations. (NYT)

Dinosaur myths Around 700 different dinosaur species have been discovered, with more found every month. Our ideas about dinosaurs have changed radically. Here are six myths about them (The Conversation)

Video of the day

Pound tumbles as UK votes Out Britain has voted to leave the EU in a vote that will send shockwaves across the world. John Authers in New York looks at the market reaction. (FT)