♪ friday, the 24th of june. i am rishaad salamat. this is "trending business". ♪ rishaad: we will be in london, new york, and beijing this hour. initial results showing that leave campaign ahead in the u.k. referendum. the pound slumping the most in six years after climbing against the dollar. that a brexit might mean a recession.

recordin recoiling. let us know what you think of our top stories. follow me on twitter at @rishaadtv, don't forget to use #trendingbusiness as well. , a lot ofl volatility. it has been a whipsaw session. let's start off with equity markets. the msci asia-pacific into negative territory. we are seeing some of these utilitiesil, gas, and starting to drag on the overall picture. taiwan, singapore, and malaysia joining the fray. times at a 10th of 1%

at the open. kiwi stocks hanging onto gains, off session highs. australia extending losses. energy and materials names dragging things down. these oscillations in the yen playing on exporters, a general risk off sentiment suggesting , we aret earlier bounce now seeing people selling on the news. saying that we could just be getting a dose of reality, causing fees skittishness we are seeing. in terms of the currencies we are watching, the yen sitting at 105.06. we are starting to strengthen as we speak. early on, we had it almost

breaking through 103 before pulling back. had this tandem effect in the pound, falling the most in 24 years, so extraordinary movements in the fx space. we are sitting a bit lower like close to 3%. the volatility, you can see it in the chart, record highs. after an initial risk on start, appetite coming back into safe havens. down 1% in the overnight session, but gaining all that back, then some. that it wasconcern going to break that 1260 psychological barrier, but w are far from that now.

anything could happen is what we have learned from this session as we await those results from the u.k.. rishaad: the bookies in the u.k. are favoring a leave vote right now. youodds in favor of that, get more money if you put your cash on remain rather than leave. , but we are really at -- aren't we? probabilitychecker of remain has fallen to 59.6%. was over 90% before we got a lot of results. speaking of results, let me take you to a map to get a sense of

where these are coming out. blue is indicating remain, so we are seeing that largely come up in scotland, but if you look at england, predominantly leave results so far. 382 voting areas declared so far. some strongly bureau-skeptic -skeptic areas have voted overwhelmingly for leave at 69%. , 56%we have from wales leave, a bigger proportion of leave than projected. area, this was projected to be pro-eu, and it has shown a 52% result for leave.

we've also had the city of london, 75% for remain. this was more than expected, but this is a tiny area. it is not representative of the whole of britain. what is the broader context around these results? context is that we are seeing leave push ahead, 53.5% versus 46%. results, of all the where we got surprises that moved the markets were from the northeast of england, where we had a higher margin for remain at 51%. ahead of whatnts had been expected. flipside, in the west of

leave,, 45% remain, 55% that 10 point margin was less than expected. you can see, quite hard to interpret all this. we are getting surprises on both fors, both in proportion leave and remain, but at the moment it looks like leave edging ahead. still early on in the night. of the get the bulk results between 3:00 a.m. and 5:00 a.m. u.k. time. a lot of the big cities waiting to report results. results fromd london as a whole, the city as a whole, and a lot of other big cities have not reported yet either. rishaad: thanks. london, our chief

economist for the europe, middle east, and africa. we are seeing ftse futures down , the deltas so far amazing, so a hugely rocky ride since polls have closed. >> yes, it is astonishing really. the markets are waking up to the fact that this is more complicated than they thought. we do not have any president pre oding -- it is a lot closer than people thought. sterling is down the most in history could since 1970 -- history. what would it mean for the british economy if indeed, well,

eu? u.k. leaves the yo britain's will feel most and first is the effect of our exchange rate movement. if britain these and the exchange rate falls by 10% or 15%, that shows up and import cost, cost of fuel, everything, so people will really feel it in their wallets. in the medium-term, we expect the economy to be a bit smaller. good for lifting incomes, increases competition, steal ideas from your partners expectworld, and we slower trade flows as a result of leaving the eu. a smaller in economy and lower incomes for the british people is what were looking at if britain decides to leave the eu. rishaad: right, let's move along and talk to about what we have.

check our website, bloomberg.com/asia. some other stories making headlines, one of the biggest indian conglomerates -- juliette: ordered to pay $1.2 billion in damages to a japanese phone operator for an "breach of agreement." the london court of international arbitration claims the indian conglomerate failed to fulfill its obligations to for a buyer for its stake 50% of the acquired price or whichever was higher. billion in2.5 exchange for a minority stake in the indian sailor service provider. in july 2014, it exercised his right to request a suitable buyer, but by january 2015, it claims the request had not been met despite "repeated negotiations."

the big u.s. banks have won a thumbs-up from the fed, passing the latest tress cast, indicating they would be able to withstand a severe economic shock. citigroup got the highest from the fed, while morgan stanley trailed its peers. it's 4.9% ratio tied for last place alongside a canadian bank's u.s. unit. the results marked the second straight year that all forms -- firms pass the exam. earlier this week, janet yellen said the stress test process is about to undergo "meaningful changes." it seems the rich are getting richer and the asia-pacific. tovate wealth surged 10% $17.4 trillion last year thanks to stronger economies and property markets, marking the first time that wealth among millionaires in the region passed that in the north america.

recession and political turmoil in brazil meant declines in south america. rishaad: thank you very much indeed. we haven't seen movements like this when it comes to sterling against the dollar, dropping the most since 1971. 1.50 an hour ago.la -- reynolds will join us to make sense as this results out of britain is seriously in the balance. ♪

rishaad: you are watching , early eubusiness"

referendum results out of the u.k. let's have a look at what's going on and how the u.s. is looking at it. >> thank you very much. the s&p closed 17 points off a record high today, but right now, futures taking a huge leg lower. -- are all down, as well as the dow. stronger than expected support for the leave camp. you see those numbers right there, falling across the board as much as 2%. two point 1% for the nasdaq. nasdaq.for the m leave is currently ahead 53%

against 47%. still early days, but we continue the account. -- continue to a count. gold is higher as you might expect. now, up 1.5%. on the flipside usd-yen cross is strengthening 2% against the u.s. dollar. finally, the 10 year treasury yield, down six basis points. wednesday, higher but has slipped 1.62%. all these measures, it is a risk off as we wait for further results out of the u.k. rishaad: thanks. right, the fx markets. adam reynolds joins us now. this is quite a morning for us, isn't it? morning.

it has been an interesting morning. we had a big jump up to 150 on polls.s of polls -- exit the results have been better for leave than we have been expecting, by 5% or 6% and a lot of them major cities. we think volatility is here to stay. is still early days, but leave is looking better than expected. rishaad: if you look at what the taking, the bookies are will give you more money if you bet on leave it you are suggesting it does not matter, but it is the scale that will be absolutely vital. what i was suggesting was that if the remain camp wins, then the scale of the wind is vital. if it leave wins, it is very important.

i think that if remain wins by a small margin, it is different 54%, 50 5%, win by as happened in the scottish referendum. ifhink it is a large impact leave does creep over. here, wethe thing is have not had the big cities come in, but in the run-up to this, where you how surprised how sanguine traders were? did you sense a degree of complacency? >> i think to a certain extent, yes, but the catastrophic or high volatility expected was to rich for people to take the positions. the size of market positions has been massively reduced. inhave very small positions yeaeuro-sterling.

deciding towere wait until after the vote to reengage with the market. i think that was common across the whole market. rishaad: we saw what volumes were like just recently. where we see a day volumes of a magnitude that we have not seen in recent months? >> if you look at the traders in the banks of london or work they are going to be dissecting the information at the moment, and that's why the betting odds are moving so aggressively. lead willis leave start to be a eroded win more results come in from around but a pretty impressive leave so far, so it may be slow

to be eroded. i think it is possible that leave does breakthrough in the end. oxfordshire, 70% in 30% leave.main, beyonds implication britain's borders, particularly when it comes to the eu. how does that affect what happens to the euro? is the biggest loser if the u.k. leaves. in fact, for me, over time, the sterling will recover and sterling-euro will go lower. i would be more interested in -yen. short, perhaps euro will prompt other countries to really ask themselves if they want a vote as well. rishaad: many thought the swiss franc was a haven.

>> i think that euro-swiss is interesting. the swiss bank is concerned about swiss strength, even though they don't have the line in the sand that they used to have. i think the dollar will be strong. i think being short euro is probably the best trade. rishaad: this is the biggest islandg area in northern , 56% remain, 44% leave. the thing is, as we get more urban areas, particularly in england, we should be seeing more favorability towards the remain camp, but how do you

think this will play out when it comes to scotland? would it make a scottish referendum more likely if britain votes to leave? >> i do think that is the case. i think scotland will vote remain firmly. in england, the biggest remain areas are around london, manchester and birmingham will to being balanced or on the leave side. leave, ik. votes to think there will be a push for a scottish referendum again fairly quickly. rishaad: thank you so much for joining us today. indicatorsext, early in china showing some stability, -- instability, but also strength. we are live in beijing next. ♪

rishaad: right, this is

"trending business". i am rishaad salamat. the u.k. referendum to close to news,but looking at other china's rebalancing economy is stabilizing. smaller companies are feeling the pinch. at theenzie is looking divided fortunes. what more do we know? stability is the overall theme from these early indicators. if you look into it more closely, you see a division between small and medium-sized enterprises on one side and the largest firms in the country. manufacturing pmi data fell to four month lows. they are saying they are fighting harder -- finding and harder to find these and employees. at this executive

sentiment survey that came out, it shows a big uptick for executives at the largest firms in china, 54.5 versus 50 last month. that is strong. it is an indicator that is notoriously volatile. saw a data from satellite manufacturing indexes showing a mild uptick. sales management sentiment remains in line with may. what it shows is that the l-shaped remains in an pattern. bloomberg intelligence does not expect further stimulus at the moment. rishaad: thank you very much indeed. premarket hong kong, it u.k. listed banks having a tough time of it. standard chartered down 3%, hsbc taking a big hit

as well. ,terling taking a big hit tumbling by the most on record ahead of that referendum vote. we have more on britain deciding next. ♪

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♪ rishaad: a look at our top stories. the u.k. referendum suggesting a far closer race than opinion polls. surveys had predicted -- markets recoiling at the increasing possibility of a brexit. the sterling dropping the most since 1971. u.k. and s&p 500 futures falling. gold surging. british banks in hong kong plunging.

brexit leader boris johnson has written to david cameron saying he should remain prime minister whatever the out come of the referendum. let's get straight to the open in hong kong. we are feeling it, aren't we? haidi: talk about feeling it. 2% hang seng index down by in the past few minutes. has taken hold of investors in asia. shanghai down by three tens of 1%, also downward pressure on the chinese currency. elsewhere, increased selling going on, sydney down 1%. been hangingad onto modest gains, also turning negative, down by seven tens of 1%. , so muchi 225

volatility. nikkei 225 fell 500 points in just a few minutes. three now lurched back to tens of 1% lower. yen that happened, the touching 103 again. elsewhere, selling from southeast asia, malaysia and singapore down. only stocks in seoul, korea have managed to bounce back. asia-pacific down .5% at the moment. the board,ross financials leading losses, as well as oil and gas sectors. you spoke about some of the movers. we are looking at hong kong

listed stocks exposed should we end up getting a leave. down, off the session lows. sharp also plunging. , that tokyo session double when me of the stronger to and restructuring to move the secondary market. this is what we are watching in terms of currencies. the yen has been all over the place today. it is starting to strengthen again. we are seeing that play out in terms of the appetite for equities, a complete reversal from earlier in the session. we had those gains in terms of risk appetite-friendly currencies, the aussie and kiwi, playing out with appetite flowing back into safe havens. gold for example, traders were

worried that it would break that 1260 level. surged past that, gaining a 10th of 1%. ,ame when it comes to the ftse now a repricing effect, extending gains by seven tens of 1%. risk off sentiment playing out in the oil markets. brent was holding above that $50 a barrel mark. some subdued data in terms of u.s. stockpiles helping sentiment. percent.to -- 2%. this is also playing out in asian currencies exposed to that risk appetite story. the aussie hitting a two month giving it all back.

we're seeing changes take place minute to minute in some places. britain ate tally in the moment, slightly in favor of the remain camp, 50.7% of the electorate that has voted are suggesting let's stay with the european union. 60 areas have reported so far. let's get to london. these results are coming in thick and fast. what are you thinking? >> brace yourself. let me show you the map where we can see the distribution of the results. 65 of 382 voting areas declared so far. blue is remain, red is for leave. recentlyave had more is a number of declarations showing remain in favor, oxford .0% remain

are all within the top 10 pro-eu areas, so be aware of that. glasgow 67% remain, also in the top 10 pro--eu areas. we have had a couple of swing areas declared. we have also had northern island -- ireland, which is the biggest accounting area, 56% remain. so we have had these come in thick and fast. wales, 59% leave, 41% remain. in a broader context, let's talk about this. what can we read from these latest results? >> you did mention it a little bit earlier that we are seeing

remain edge ahead. remain at 50.7%, leave at 49.2%. have these we results coming in, it is still early on in the night. of 382 have declared, so we are nowhere near halfway through yet. odds checker, got to look at that. before we got these results and the commission unofficial exit poll, we were 90% chance of remain. 49%he moment, 57% remain, rags it. it is still looking -- 49% brexit. it is still looking close. yeah, thank you very

much. at the moment really, it is so close to call. that's what we have at the moment coming through. ftse futures down 5%, starting tumble. -- sterling tumble. the pound, rocky ride since the polls close. we were 150.18 at one stage. we are not far off that, are we? >> know, we are not. is one of the largest intraday movement in sterling. it is in line with what we had been expecting. we just weren't expecting the inements to be that big terms of probability. we said earlier, close to a

90% chance of remain went down to 40% chance of remain, an enormous movement. that is driving the movement in the currency. we are seeing some surprises and wales, more support for leave than expected. seeinges on england now to where this night takes us. economy was the focal point when it came to the debates surrounding this referendum. what happens if we do see it a departure from the european union? a further depreciation in sterling, 4% or 5%. will show up and higher inflation, causing a problem for the bank of england. it will have higher inflation, and on the other hand, weaker

gdp growth. our feeling is that they would cut interest rates in response to the weak demand and ignore the higher inflation, because it will only be short-lived. rishaad: thank you very much indeed for that. let's get you straight back to the market action. when we last spoke and now, markets going back in hong kong from those losses. 2% as trading began. we are now down by 3/10 of 1%. were looking at the biggest losers, companies with significant exposure to what ever fallout a leave vote went in-depth having, hsbc, standard chartered, leading losses. hutchison holding down by 1%. fact, the top decline or when it comes to the hong kong session. these were all off the session

lows. we have uncertainty over growth, over whether the bank of japan has run out of let's in the easing program, whether the fed will move, the chinese slowdown is well, so analysts saying that if we get this uncertainty from the u.k. and europe, it is just adding on a pile of quite a lot of and certainty. -- of uncertainty. volatile affecting every asset class. the pound volatility is at a record high. we are looking at the yen moving from minute to minute, being played out in terms of risk appetite for equities. take a look at the australia session. the gold producers, we did have them as some of the biggest decliners given the 1% loss

overnight, but as safe haven demand has flown back into gold, where up. -- we are up. the energy and materials space have done well. in the last couple of the minutes, shanghai turning weaker yuan to contend with. u.s. dollar starting to strengthen. u.s. treasuries, the yield falling the most this year. ono, yields falling two-year, five year and tenure aussie bonds as well. this risk off of picture we have been seeing. let's look at whether currencies are sitting regionally. the aussie dollar off by 1%.

we are also seeing losses across the oil market as well. strong gains overnight, letting go of that, down 1.6%. those indicators falling below that $50 level. on the other side of the spectrum, year classic safe haven demand play, gold taking back losses from overnight. safe haven currencies like the frank, up by 6/10 of 1%. as we see with these vets coming through, the markets is a situation changing minute by minute. rishaad: thank you very much. indeed, getting more views on this. the former british consul general to hong kong says the referendum remains very much in the balance. ♪

rishaad: you are back with "trending business", massive swings the across the market in this part of the world. what you seeing? david: we are watching a lot of things. what we have observed is that there is a very close correlation between the results and the moves across the market and the underlying odds and probability. indexe been checking this for the better part of last few weeks. there is your ticker right there. these are based on bookmakers quotes. projectally tries to the implied probability of a brexit, which is at about 44%, 45%. let me adjust this and give you what this looks like on an atraday basis, going up 65%

one point. that is one chart you might want to watch closely. the other thing i want to bring up is that we are watching the pound very closely as well. this chart i have for you right here tracks the daily percentage change on the spot price of pound sterling going back to 2007. it is almost like a seismograph. of your screen, you see those two swings right there north of 2% and south of 2% the last two days. the last time we saw swings this wild or large was during the global financial crisis when we saw pound sterling drop 3%. that is something to track as well. you are looking at implied based onty, this is

the options market. this is on the way up given the moves we are seeing in pound sterling. if you look at the bloomberg pound index, we also have that measure. we are looking at the contract on the vix. futures, 18.2. we were as high as north of 19 there. the nikkei 225 has come down a little bit. the past 15-20 minutes have seen markets calm down a little bit. thanks, david. companies in hong kong and china with production in the u.k. might have a material impact on their business depending on the outcome of the referendum. the executive director of the british chambers of commerce in hong kong, thank you for coming in.

what a morning so far in this part of the world. in the run-up to this, what was the feeling you were getting from your members? >> a big shift. the hong kong and chinese companies didn't really know about the referendum. to the extent they knew about it, they assumed the vote would be to stay in. as we got closer, reflecting wider uncertainties, we have seen a rapidly rising level of interest and some concern. rishaad: there is a division between those hong kong companies and those british companies based here? >> i think that is right. hong kong companies have invested in the u.k., using the u.k. as their european base. i think it is fair to say that it would be better for britain to stay in the eu. to the business people here, it

is more divided. there are a range of views reflecting that range of views you have in britain. there has been a significant minority coming out in favor of leave, reflected in british business opinion here. rishaad: what are the implications than if written votes to leave the european union -- if britain votes to leave the european union. ,> if the vote is for exit there will be an immediate market reaction. longer-term, even if the vote is for brexit, that does not mean that britain is out of the european union this evening. there will be negotiations under article 50, determining firms exit from the eu. where be like a norway, switzerland -- i think companies

here will be looking very hard about negotiations, looking to see which way that is going, looking to see what the implications are likely to be for their business. if you're looking for a positive outcome, that process and the time taken will involve some uncertainty, and businesses don't like uncertainty. rishaad: certainly not. china has use britain as an advocate in the eu. beijing will not be happy if there is a leave. >> the president came out wasrly and thought it better for britain to stay within the european union. this reflects a long-standing policy preference for having a multipolar system in the world, a strong eu and britain as historically a very active internationally-minded member of the eu, an important part of

that eu structural they favor. if you look at what is going on in the free-trade debate across the world, candidates in the u.s., there is something of an anti-free-trade movement developing. the debbi tos talks have stalled. -- wto talks have stalled. from an asian perspective, asian economies have benefited from freer world trade, there may be at a concert in the future direction of eu policy on free trade. behaad: it's not going to business as usual for the european union tomorrow, is it? >> there will be a process. , everythingn exits carries on in terms of rules,

regulations, access to free markets. you're right, actually it seems to meet whether the vote is remain or leave, the conclusion be business as usual for the european union as a whole. powerful some very messages here from voters in britain. rishaad: thank you very much. we will look at the markets right after this. sterling being bumped around at 50 at one, one dollar stage. it has just recovered a little bit. futures on the ftse index down by 5%. ame weakness, paring back little bit for asia-pacific markets. this is "trending business". ♪

rishaad: all about events in

great written at the moment. it does seem to be very much in the balance. liverpool has voted to stay in the european union. the pound and futures taking hits. it has been a whipsaw session for the ages. off ag pressure coming bit, particularly greater china markets. lower by 2%, now in positive territory. having said that, weakness coming through these banks heavily exposed should we get a leave scenario. charteredtandard falling, the biggest a kleiner's. these stocks down by over 3% at the open. shanghai down by a 10th of 1%, selling pressure coming off in the southeast asia markets.

australia extending losses, down by one and 3/10 of 1%. the oil producers taking a hit. kiwi stocks also down by 6/10 of 1% despite vitamin a holding on to gains. violently yen strength weighing on exporters. this is going to be some cause of concern giving the demand for safe haven assets has driven the the yen, gains in causing huge problems for the central bank and equity investors. sharp also declining. the company announced it would

be moving to the second section of the tokyo stock exchange. things are changing minute by minute. back to you for now. rishaad: moore market action after the break to read -- break. ♪

rishaad: you're watching "trending business." this is what we're watching. initial results in the u.k. referendum. sterling falling most on record in response markets recalling generally in the face of

antipathy. the aussie and the euro both down while gold snapping a four-day route. cameron said whatever the outcome of the vote, his response is not known yet. straight to the market action. well, what have we got? it is all over the place at the moment. e are better than we were. >> yeah. look. it is a tough day to be an investor. volatility globally. fx in particular falling all over the place. this is what we're seeing. a few minutes ago we had the hang seng in positive territory. we have .10. the u.k. 225 has been all over

the place. japanese stocks now down by .7%. steeper loss coming through from sydney. a number of these manager and mining names. it is interesting. we are really seeing these stocks that are trading in hong kong that potentially had a bit of explosion downward. if the vote comes through as a lead vote. having said that, both of these lenders, we're down by over 3%. we are seeing that version easing off a little bit. sharp is down by 12%. it was down by 16.5%. the biggest decline since may 2015. the company announcing the stock would be moving to the second session of the tokyo stock exchange. in terms of what we're seeing, i want to talk about the japanese

markets. there has been so much volatility. we have this nosedive down over 500 points when it comes to the nikkei 225. we have come back up again as the yen also has stabilized a little bit. speaking of the yen, we have seen this plunge or rather the gains strengthening to the highest since 2014. that is very much creating a problem, not just for japanese investors but also the bank of japan very much closely watching these developments given that it has wreaked havoc for the currency and the stimulus program. we're seeing a lot of losses coming through when it comes to the oil markets. better than expected u.s. stockpile numbers. l of that is gone below that $50 a barrel mark.

close to breaking $49. let's bring up the picture. looking just shy of $50. to the tune of about the same. in terms of currencies we have been watching the extreme volatility. it fell the most in 24 years. volatility at record highs. just last month we had the pound falling to the lowest in seven years and then bouncing back. poem we are on track for the best year since twine. -- 2009. we had passed 150 at one point. on the opposite side of the speck truck, this is a safe haven toop of morning. gold gaining about .25%. also other safe haven currencies other than the yen. we have losses overnight.

rishaad: get straight to what is going on. tell us what is going on. bookies are saying they have essentially the same odds both sides of this now. >> if you look at the odds checker which tracks these have 58 odds, we probability for remain. and 42% for brexit. it switched to a higher probability for brexit. it has now switched back. we have so far got 104 results from out of 382. let's take a look at this map that i have brought up. blue for remain. red for leave. 106 voting areas.

we're not halfway through yet but we have had a lot come through in the past few minutes or so. islington, 75% remain. this is one of the top five pro e.u. areas. fuller in london, 75% remain. liverpool, which was projected to be pro e.u., 58% remain. also stroud 55% remain but that was projected to be pro e.u. castle point, the fourth most pro brexit area, 73% leave. really what we're seeing is a theme of london being more pro remain whereas other areas particularly in the north and west of england looking like more pro leave at the moment. rishaad: just get us an idea of the significance. can you put these results into more context plist please?

>> the first results that we started to get through from the northeast was sunderland and new castle. sunderland had a 61% vote for leave which was higher than expected even though it was expected tock leave. new castle, 49% remain. it was expected to be a 12-point gap. that sent the pound tumbling. then we got a slew of results putting leave ahead. we then saw this switch up a bit when we got oxford and glask . owing remain we're really seeing a lot of toing and free throwing tonight. it is still that -- froi

everyone ng tonight. rishaad: going to get back to london. staying in london. jamie murray is here. just getting some news coming through. westminster coming strongly pro european. that was the thought. what have we got here? 69% to remain. 31% voting to leave. let's look at what's been going on and find out more on this. jamie murray is there. jamie, tell me about what has been going. the sterling is really, really, that's where we're seeing it, aren't we? >> it has been on a roller coaster. it has been tracking the betting odds quite closely. we're seeing new business around about 25 percentage points in the odds. translating to around 3% movement in sterling. there is a very strong

sensitivity of sterling to development in the betting odds as the votes come in. rishaad: what are the implications? is it really the currency which will have the biggest impact on the british economy in the short-term should britain elect to leave? >> yeah, the currency is going to be massive. there is two reasons it is going to move. one is because people would expect interest rates change in the event of a brexit. another reason, they might view usiness being riskier. that's why we're seeing these bigger swings in the currency. if britain were to leave, then yes, there would be a big impact on the purchasing power of people's incomes in the u.k. they would just be able to buy less from abroad and then we would see g.d.p. sloge. their economies would be 3%

smaller as a result of liing. rishaad: oldham voting 39% remain. 61% to li here as well. it is not just about what happens with britain and sterling. it is about the euro and the euro itself. >> yes. i think what we have seen is quite a bit of sensitivity to the euro and european equities to developments in the polls and my own feeling is that if britain leaves the e.u. it is going to find itself in a difficult position and its current partners will make it difficult. the reason is that france and germany don't want other people queuing up to leave the e.u. my feeling is it will be relatively small. rishaad: thank you very much indeed for that. having a look at what's

happening with sterling and what the implications are indeed for the british economy and the european economy there as well and just to say we have another couple of results here as well. we have aberdeen voting to remain in the european union and westminster saying exactly the same thing a short while ago. let's look at one indian company which has been facing a legal challenge in japan. >> it has been ordereded to pay close to $1.2 billion in damages to m.t.t. for a breach of agreement. it is understood ntt filed the request in january last year with the london court of international arbitration. it claims the indian conglomerate failed to fulfill its obligation. they paid $252.5 billion in 2009

d 2011 in exchange for a minority stake. in july 2014, they said they exercised their right to find a suitable buyer. they have not met their requests despite repeated negotiations. the u.s. banks have won a thumb's up from the fed. all 33 of them have paste passed the latest stress test indicating they would be able to withstand a economic shock. citigroup got the highest tick while morgan stan think trailed. falling within a percentage point of the regulatory 4% minimum. the results marked the second straight year all firms passed the first phase. earlier this year janet yellen

said the process is about to undergo meaningful changes. it seems the rich are getting richer in the asia pacific. private wealth in the region surged almost 7% thanks to stronger economies and property markets. that marks the first time wealth among millionaires topped that of those living in north america. european wealth rose about 5%. political turmoil in brazil made declines across south america. rishaad: right. of course we'll have a look at that story later on the program. e want your opinion. just a couple more results coming through from the u.k. at he moment. this was in surry. it was predicted to stay with the european union.

darlington, this is what we have at the moment. coming up later on the program, lots more on the u.k. referendum. full analysis throughout the show. next on money managers we're going to change the portfolio ahead of these results.

rishaad: it is all about that british referendum for europe. tell me something. you know, we have seen these huge moves when it came to the currency markets, particularly of sterling. we like to see that when it comes to equity trading as well. will volumes -- we have seen volumes significantly higher

than they have been of late. >> you'll see a pickup in volumes. one of the cases you can make is perhaps the moves in the markets and sterling will be more modest than people expect. rishaad: we have had a 10 pence today. it has been huge. >> if you look at the range on sterling, it has been quite wide. it is trading off 3% having rallies quite a lot over the last few weeks. the move is not that significant. rishaad: you don't get moves like that. we haven't had a move like that since 1971 and that was government orchestrated. that was a devaluation at that stage. >> you look at sterling, it has fallen by about 6% or 7%. since the start of this process. in the last week, it has shown a bit of a rally. recently it has corrected a bit.

at the moment we're looking at 2% or three 3%. it is not significant as we sit here at the moment. one of the things i think it is worth emphasizing is that there is this expectation that there might be big swings in the markets and currency. if you look at impeer cal evidence the market tepids to be less disrupts. it tepids to get much more royaled by things it doesn't expect. rishaad: this is a binary outcome no matter what happens, though. it puts things in a stark light. >> it is a binary outcome from the political perspective. companies have a long history of being able to adapt to different political realities. you'll find that for many of the companies that we invest in, this will impact them only at the margin.

rishaad: the leave campaign has a 17% chance of winning this here. what happens in the next days, perhaps medium term to equitieses in europe, particularly british equities if we see a leave vote? >> there has been a risk premium attached to u.k. and european equities as we have been running into this referendum. common sense suggests that risk premium could sustain. there will be an environment uncertainty. how does the process itself play out? how long does it take? what is the negotiation process, etc.? i think the -- from a sentiment perspective there will be a degree of uncertainty and also about how it might impact things like interest rates and the u.k. economy. there is one perspective at the moment that suggest where is bond yields will fall and interest rate also come down. one thing you could see is inflation. the sterling has been weaker

over the last six, seven months and inflation has been low. certainly that is something which will impact inflation. there are other effects that could surprise inflation. nominal wage growth, movement and energy prices. rishaad: how does that then play out when it comes to equities again? that is what your job is. >> absolutely. i would say one of the things that we believe is that actually the market has been characterized by nervousness throughout this process. you know, in a way, as you would start to see inflation return and interest rates increase, actually that might give you a much better indication of self-sustaining economic growth rather than thinking we're about to move back into recession. >> some of the exporters are going to do well in the ftse 100. you look at that. you look at some of the other

companies importing going hang on a minute. >> you know yourself. if you look at the leadership in markets, you see what people are oriented towards is very secure companies. dividend-paying companies. almost kind of bond-like companies in terms of the equities they have bought. one interesting thing we could see is that pat overpb leadership start to change. i do see that risk appetite returning, i do see it returning gradually over the next several months. rishaad: stick around with us. u.k. index, we'll have a look at them. getting absolutely crushed at the moment ahead of a referendum result. it is at the moment too close and too tight to call.

rishaad: this is of course in northeastern england. new castle voted to stay in. it has gone to the leave campaign by 57%. 57% of people there, at least the ones who voted voting to acquit -- to quit the european union. this turn of events. you're very, very calm about all of this. because you're looking at it just as a political result. it is more than that surely. >> i think it is primarily it is a political -- rishaad: it has few economic implications. >> with economic and secondary short-term market impacts. but actually i think that when you look at first of all when you think about the u.k. as a corporate sector it is an international corporate sector

for one of the markets where you should be looking trying to look at this in a bit more of a sanguine light it is the u.k. market. look tagget u.s. corporate sector and 60% of u.k. of u.s. revenues is off the domestic sects of. the u.k. is 30% to 35%. we have seen a corporate sector used to adapting to different political realities over time. certainly it is long-term investors. this is a -- it is an important historic political event but in terms of business and markets it is, you know, it will -- we may struggle to find this on the chart in five years. >> the thing is how do you look at european stocks and what sort of sectors do you think are going to be impacted by a leaf vote in the u.k. in europe? >> from an economic perspective

where we're more -- about the outlook. for political perspective i think the direction of travel has been set with respect to the european union. whether there was a vote to leave or remain. that is i think there is very clearly when you look across europe you can see this politically as well. there clearly is this debate being had about the powers and the participation and benefits of being part of the e.u. as we move towards this pragmatic union, which may be an optimistic view of the world, i think that will be interpreted in a very well -- for european -- rishaad: what about the u.s.? >> so i think that interesting with the u.s., if we extend the political instability point to u.s., i remain relatively sanguine there as well. part of the reason being as you move into an environment of fragmented politics what that means on the upside is very

little of the more extreme policies that people profess can actually ever be enacteded. i know we were looking at data the over day. only a small amount of it ever gets passed. if you have these figures and dramatic figures and what they can put into play is modest. rishaad: when markets open in europe, are you going to be looking at these short-term issues as you put it now to look at the long-term? that is the thing. how do you do that? >> our day-to-day role is to look at these sentiment swings that play around macro economic factor thass create dislocations in share prices and companies that we want to own for the long-term and absolutely we use those to our advantage. rishaad: thank you very much indeed. head over european equities. talking deputy chief -- at the moment in tokyo saying

that desirable for the u.k. to remain in the european union. this is what we have. this is leeds. not sure if we have a result there. we will bring you all the latest. we're all voting 52% to remain in the european union. we're live in london next.

rishaad: our top stories. it is a very tight result so far in the british referendum suggesting a closer race than the opinion polls suggested. markets are actually the possibility of britain leaving

the european union, the pound slumping the most on record. u.k. stock futures plunging. the yen and gold both surging. both seen as being havens. plunging. hsbc and standard chartered feeling it at the moment. let's see what boris johnson has been saying. he has been writing to david cameron saying he should remain as prime minister. let's have a look at what's been going on with the markets. they are jittery to say the least. here highly fluid. >> the situation fluid is a bit of an understatement. we have been all over the shop this morning. talking about the pound and these declines you see falling

the most in 24 years as you say. this just in, the pound falling below 140 for the first time since march 2 this year. ownside of that .5% and .6%. trading at 1.3977 there. at one stage, it does give you a better picture over the volatility we have. we're expecting to have the highest levels. we have that level in december and came pretty close to hitting it there. all of that of course has become something of recent history if you will as we see these gyrations in the currencies markets play out. we're also watching closely of course the yen. that has also been a big nufere the day's session. really to the detriment of what the b.o.j. is trying to do.

they are watching what happens in the u.k. closely. take a look at that. back at 103 for the yen, the highest since about 2014. up about another .2%. we have had so much movement in the japanese currency this is playing out in the appetite for equities. gold, it declined overnight as perhaps the markets kind of mispriced their expectations how these polls were going to tournt. gold with a recovery up almost %. gold picking up a little bit after weakness earlier on. the opposite is happening in the oil market. we had some gains overnight. brent, $49.26. up about 3%.

w.t.i. seeing weakness. $48.45 despite u.s. stockpiles showing less in supply. clearly the sentiment is playing out. another way of looking at this swiss ven story, the franc was a little bit lower overnight. we have quite a lot of red now across the board. so much volatility. global volatility when it comes to these markets. the highest that we have seen since the global financial crisis. we have seen this playing out in hong kong. the hang seng is down by over 2%. we have got some of these extended declines when it comes to these lenders that have quite a bit of exposure to potentially what happens should that result in the u.k. come through as a leave decision. hsbc down by 1.5%. one of the top decline rs.

standard chartered seeing losses about the same amount. c.k. hutch doing quite poorly as well. elsewhere around the region, losses being extendeded now. the nikkei 225 doubling down. losses about 3% when it comes to those tokyo stocks. that stronger yen is weighing heavier on these currencies. what does the bank of japan do next? the stronger currency has wreaked havoc. the other leading decliner sweerg sydney where we're down by about .3%. the aussie dollar hitting a two-month high. one of the leading decliners in the region. we are seeing a lot of selling coming from southeast asia now. sings pour doubling down in terms of the losses. hanging on to modest gains down to 1% as well. even shanghai, one of the more

protective markets in terms of what's happening what's happening in europe now seeing extended declines. this is the picture as it stands now, a moment in time. things have been changing very, very quickly, rish. rishaad: yes. now there is more and more people coming out and well not really calling it for leave but certainly saying that it is headed in that direction >> well, if you look at the odds checker which of course collects bookmaker odds then that seems to be what it looks like. we're seeing a 76% probability of a brexit looking at the odds checker. if i update you on some of the results that we have had recently, we have got some areas that were projected to be slightly e.u. actually showing a majority for leave. so at gates head in the north of england, 57% leave.

it was expected to be slightly pro everings u.. sheffield also projected to be slightly pro e.u. is cominging in at 51% leave. darlington again in the north was expected to have a 10-point ead leave. a 12 point leave lead. and wales, projected to be slightly pro e.u., 55% leave. we also had another swing area report. leave. ome at 57% leave looks to be pulling ahead slightly. 51% versus 48.9% for remain. >> get us into context here. they had all sorts of twists and turns, hasn't it? >> it really has. even looking at the odds cherk probability at 76% now. the before a lot of these results came in we were at 90%

probability of bremain and it switched to a higher probability of brexit and then back to a higher probability of bre minute and now we're back to a higher probability of brexit. let's show you to distribution how people have voted. blue for remain and red for leave. scotland seems so far to be very reremaining and england and wales more in favor for leaving. what you can't see because the areas are so tiny is that most of the results we have had from london have actually come out overwhelmingly in favor of remain. that is the distribution we're seeing. london looking very much remain, scotland too. the rest of england and parts of wales looking favor of remain. rish? rishaad: scottish capital coming through as well.

74% of edinburgh residents at the moment voting to stay in the european union. at's what we have at the moment. edinburgh voting to remain in he european union. >> we were just talking about how volumes remain thin. they are not thin when it comes to the ftse futures. i'll show you that map in just a moment. we were talking about the moments as well. i think this -- this graphic i have right here, just really underscores the amount of risk aversion that we're seeing across global markets. that is the japanese yen gaining against every single major currency on the planet. we're not just talking of gains of a quarter or 1% the smallest movers against hong kong dollar. 2.4%. have a look at the move against pound. the pound is basically moving 8%

against japanese currency. that is taking that down to a three-year low. that happened in the last 15-20 minutes or so. that underscores the risk aversion that we're seeing. this could all changing depending on the results coming in. the odds checker metrics. i'll show you now how that looks on a chart. what i have done here is put the two charts together and in green, you have the implied probability of the u.k. staying and then you have the brexit here in red. that is a three-day look. right before 4:00 a.m. hong kong time, you see how wide the gap was between the two. you're basically looking at a 90% chance that the u.k. stays. a 10% chance they lever. you see these two lines converge and that's why we're seeing all of this volatile any the market now. it is almost a 50/50. in the last five minute or so, they have diverged again.

so this is your undercurrent. this is the one you want to watch very closely. there are other measures as well. this is on your bloomberg. dchremn index based on odds cherk.com. you put the exit instead of the remain and you get the mirror reflection of that. that is one metric you want to watch out for. implied volatility on the pound sterling. we're looking at one month options here. there are obviously more options as well. it is continuing to spike at the moment. 're now at 562656 for this level. not -- 2656 at this level. now on the spot price, we have another chart here which actually measures the -- it

measures the percentage change in the pound from the previous session and it tracks that all e way historically down to 2006-2007. so this bit here, as you can see, 2.3% up a few days ago over 6.5% drop that you're seeing right now. in other words, you're seeing on the spot ings rice over the pound. back then in 2008, the biggest move you got was over 3%. we're looking at a move now of 6.5%. again, when you look at this this is always about thin trading volumes. who wants to get into the market now? who wants to get into the position when it comes to the spot price? i believe we have just a minute -- actually let me just end with

this. can we get the futures up as well? the contract on the vicks? -- vix. last i checked it was -- quite a bit. you can't really trade the vix. you can trade the futures at the moment. up 17%. nikkei 225 up 7%. of course we just talked about some of the spot prices in the cash market. risk aversion that this all could change. hong congress to down the most in four -- hong kong down the most in four years. 138, 137. keep in mind you know, as we enter this week, people were calling for this to fall below 135. it takes you back to levels of 1984. just to put that into context. yep. more to come in a bit. rish?

rishaad: right. the biggest fall we have seen in four years for the bank here over 7%. slight recovery taking place. ofbling this is all happening at the moment on the hang seng index. we're seeing a lot of movement across the asia pacific and it is to the downside. we have heidi looking at what is going on now. >> if you want a max row story of how we have seen this roller coaster ride look no further than hsbc. we opened at about 3% or so lower and we had a little bit of a recovery and then all the way down. falling off a cliff down 7%. the most since 2011, october 2011. we are really seeing this play out for a number of these banks in have exposures to the u.k. ansd european side of the business. standard chartered falling

although not quite as badly as the top decliner hsbc in the hong kong session. this is really a situation that is changing minute by minute. we're seeing the hang seng as you saw with hsbc leading those declines extending those losses by 3.25%. you do have hsbc the third top decliner, rather the top decliner when it comes to that ong kong session down .7.4%. the nikkei down 3%. pretty close to session lows. elsewhere around the region, a lot of selling going on. even china. they have been fairly sanguine about the prospect of a brexit. rishaad: get manager narls, we'll be getting some from the best in the business after this very short break.

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>> within the e.u., one of the biggest trading blocks in the world, britain had been one of the strongest voices for free trade, for business freedom. i think from an asian perspective is they look forward to the implications, in economies which have benefited from free trade and maybe a concern there about the future direction of the e.u. policy on free trade. >> if it is the sort of people who are disaffected by politics and won't vote for anybody or anything but might come out against something, then that clearly helps the leave. we also know there are a lot of people young adults in particular who don't normally vote. if they are the ones that are turning out, that is going for

remain. we'll have to wait and see which of those it is. certainly based on results in the northeast, it seems that some of the -- some of the levers who don't normally vote seem to be turning out in those areas. >> i do think this is happening and it is a very polarized charged atmosphere. i think we can see a little bit of the market jitters because people don't really -- they are thinking it might turn more strongly towards remain now. there are results coming in that might suggest the opposite. rishaad: this vote kenneth faried closer than the opinion polls implied. it is a situation. there are a lot of moving parts here. tell us what is going on. >> well, i've been keeping an eye on the odds checker probability of a brexit or bremain rish. at the moment we're seeing an 87% probability of a brexit.

this was at 90% probability of bremain before we got many of these results out. so a real switch coming through and this has been swinging back and forth throughout the night as these results have come in. just a few more coming through now. another swing under in this referendum. coming in at 52% remain. 48% leave. look at it, it looks like lever is still pulling ahead. leave 48.61% for remain. leave gaining momentum. rishaad: this has had a lot of twists and turns. give us an idea of the context behind some of these results. >> well, i have a map that i can show you to look at how this is panning out across the country.

blue for remain. red for leave. the remain has come very much from scotland and also largely from london where most of the areas we have seen report results have been at 70% or higher for remain. england and a lot of wales actually is where we're seeing the rest of england other than london of course and wales is where we're seeing support for leave. we're more than halfway through 205 out of 382 voting areas declared. i've been talking to someone and he said look, you know, this is looking now like we're seeing sterling $1.30 here we come. he said it is looking pretty serious. rish? rishaad: yeah. a manchester voting remain. let's stay in london and get to bloomberg intelligence and jamie murray. it is about sterling today. we have had this feed through to

some of the other currencies. 5% down against swiss franc. sterling getting an absolutely pounding. >> yeah, it is getting battered. we knew that the pound was going to be sensitive to the outcome. we could see it in the run-ups. in the month before, every time the odds of brexit changed, you could see it mimicked in sterg sterling. so the relationships still holding. it is the same as it was before. the thing that has change second-degree the odds have changed massively. we have gone from 90% support to remain to 90% support for leave ch. which is just astonishing if you look at the based on the odds checker probability of brexit index. rishaad: tell me, you know, what happens? what are the immediate things that we'll see if britain does vote to leave? it is not going to leave the

next day. it is a process involving the treaty of portugal and article 50 here and it takes a couple of years. >> yeah. what we're seeing here is the currency market doesn't wait two years. it moves straight away. even though the negotiation also take a couple of years to play out, the impact on people's wallets, what they will be able to spend in the u.k. will be immediate. we'll see lots of increasing costs of imported good that will now hurt british people significantly and we'll see demand slow, g.d.p. growth slower, we could see tension in financial markets, the bank of england said it will pledge some liquidity for that to prevent that. we have seen a bit of tightening of financial conditions globally as well. it is having profound effects. the reason is it is such a big surprise. this is not just brexit. . is an unexpected brexit

manchester is ready to remain. market swinging. reactions coming up next. ♪

rishaad: you're watching "trending business." it is all about this referendum taking place on the e.u. and in

the u.k. k. at the moment far, far too tight. it is looking at though things are veering towards that leave campaign. david? >> it is really about this. there are different measures right now. there is an ongoing -- obviously. have a look at these odds. this is a three-day look. we have been checking this since the starts of the week. een line basically shows you the likelihood that the u.k. stays. the red line that it exits. at 5:00 a.m. hong kong time, the odds were quite wide, 90% in favor of staying. less than 10% in favor of brexit. as the morning progressed, you see the two lines converge right about here. we got a sense of calm in the markets somewhat and then over the last 20 minutes o so these two lines diverged again. at the moment, i'm not sure if

you see the number. the green line probability of he u.k. staying is at 18%. likelihood of a brexit, now closer to 19. that shows you why we're seeing these wild swings in the market. et me end on this. the yen against every currency on the planet. it is -- it shows you an absolute rush to safety here. dollar yen, japanese yen up against everages. the pound is down 12% against japanese yen. of course as you can see the bottom of your screens, surged past 100 for dollar-yen. rishaad: sterling plunging there. hsbc down the most in four years. that's it for "trending business." up next, it is "asia edge." more on that vote. ♪

>> it is looking like the u.k. will walk away from the european union. there is a far greater desire to leave than had been thought. >> u.k. stock futures plunged along with the s&p 500 while the yen and gold both surged. >> results show a deeply divide country. wales and england seem eager to

go. >> brexit leader boris johnson has written to david cameron saying he should remain prime minister. >> there is only one story dominating the news today. it is brexit. rishaad: currency markets, the pound taking an absolute hammering against a viret of them. hsbc in the mix here. down as much as 7%. the biggest faller we have had for the bank in the hong kong market in four years. here is heidi. >> a very, very difficult day to be a trader. it is what we're seeing. we spoke about these gyrations in the yeand pound. it is all playing out across the equities picture. we're seeing declines of about .3%. they have seen a lot of selling pressure coming through from asia. singapore stocks aredo