Global Stock Markets On Wobbly Legs After Italian Referendum Turns Into Disaster

Monday has not been a great day for stocks worldwide. Both the US equity index futures and the Euro saw significant declines ever since the result of the Italy referendum was made public.  Italian Prime Minister Matteo Renzi will resign shortly. It appears, however, that the global economy has taken another kick in the groin, and it will take quite some time to recover.

Italian Referendum Shakes Up The World Yet Again

As was to be expected, the Italy referendum did not pan out in a positive way. Then again, there was no positive outcome regardless of how the vote went, to begin with.With the “No” camp apparently coming out on top as the winner, Prime Minister Matteo Renzi will be forced to resign in the coming weeks.

The US equity index futures took a major hit once the results were published. Investors find themselves back to square one when it comes to finding new assets to invest in. Experts want them to purchase stocks and bonds, although those have been less than great choices when it comes to holding value. It is true that geopolitical considerations are souring, leaving very few options on the table.

This downtrend will affect trading across Wall Street for the remainder of the week. Starting out on a negative note is never positive, and it appears that investors will start to look for other solutions. Right now it is anybody’s guess as to what the next “asset to invest in” will be, although some distinct options can be eliminated already.

One of the assets not to invest in right now seems to be the Euro. The Italy referendum impacts the future of this major currency in a bad way and leaves a lot of questions unanswered. In fact, the Euro dropped to its 20-month low against the US Dollar, with future losses expected in the coming weeks.

A similar trend can be noted across the European stock markets, which started off rather weak on Monday morning. It was to be expected that the scenario would play out like this, although the landslide defeat was not entirely supposed to be so large. For the time being it remains to be seen if this trend will continue over the coming weeks.

For investors looking for new assets to give a try, the options are rather limited, as traditional options are largely out of the question. Foreign currencies are not an excellent opportunity right now, and the stock market remains on wobbly legs for the time being. More economic uncertainty seems on the horizon, and global repercussions are not out of the question.

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