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A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the Web

The United Kingdom has been around for a few centuries, been through worse than this, and there's ample reason to believe that last night's economic suicide attempt will be unsuccessful.

As annoying as it is to watch the leadership of the victorious "Leave" campaign walk back most of their pre-referendum platform immediately, while looking as overwhelmed and frightened as equity markets, it's probably best I focus on the importance of Brexit to Canadian portfolios.

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We learned in 2012 that European economic and financial stress is reflected primarily in the domestic banking sector. U.K. bank stocks are getting drilled this morning – the subindex was down more than 15 per cent and prominent individual banks like Barclays PLC were lower by more than 25 per cent. Many continental banks in Germany and Spain have substantial operations in London that are now at risk.

"Britain's financial sector reels after Brexit bombshell" – Reuters
"Brexit Stuns Finance Chiefs as European Bank Stocks Plunge" – Bloomberg

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There is now a non-trivial risk that the European Union experiment will unravel and we can expect EU officials to play hardball with the U.K. during separation negotiations. Scotland's independence leader has already announced there will be another referendum there – the Scots voted overwhelmingly to stay in Europe – and Marine le Pen, leader of France's bigoted nationalist party, has gleefully replaced her Twitter avatar with the union jack. There are also substantial contingents in Spain that are disappointed in EU membership.

The German Dax index is getting hit far harder than the FTSE which also suggests dissolution-related fears.

"Europe Stocks Set for Worst Drop Since 2008 as U.K. Votes Leave" – Bloomberg

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Credit Suisse has declared 'The end of globalization" as a result of the Brexit vote and this too has major implications for the loonie and the Canadian economy,

"While the actual path to exit is not yet clear, there are nonetheless profound implications for the UK. We expect a recession in the second half of the year and policy easing from the Bank of England. The domestic political turbulence may complicate the process of actually leaving the EU. There are also significant implications for the EU. We expect the euro area economy to slow, with growing support for populist political parties of both left and right across Europe likely to raise the risk of further fragmentation of the Union. For the rest of the world, the direct impact should be more muted, although there is a risk that financial turbulence has a real economy impact, with the market likely to begin to focus more acutely on the upcoming US election."

Canada is an open, extremely trade-oriented economy to the point where the loonie is viewed as a proxy for global trade by foreign investors. It's true that trade is overwhelmingly with the United States and so far, the free flow of goods across that border are not threatened. The domestic economy, however, also benefits tremendously from global trade activity. China doesn't import much directly from Canada, but its demand for commodities from elsewhere raising resource prices and profits for domestic firms. The closing of international trade borders – and global trade growth has already been weak for a few years - is definitely a threat to domestic growth if the trend continues.

"@SBarlow_ROB CS, "The End of Globalization" pic.twitter.com/9W3BdVZfxb" – (incl research excerpt) Twitter

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There are those at the Report on Business who feel otherwise, but I think it's too early for Canadians to go hunting for bargains in the equity market. Ex-PIMCO head Mohamed El-Erian noted on CNBC this morning that hedge funds who were offside because of the Leave vote – and yesterday's bullish market activity implies there were a lot of them - had yet to cover losses and this process will make markets volatile for a few days at least. I would be very surprised if there weren't a few prominent hedge fund failures in the coming month and the unwinding of their trades will make markets even more volatile.

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"@carlquintanilla "I would be cautious" about buying today, as leveraged accounts haven't covered. Will happen today. - @elerianm, on @CNBC ' – Twitter

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For what it's worth, my central thought this morning is this: Brexit, Donald Trump and rise of nationalism is the west is the result the economic elites abrogating their responsibility to spread the wealth from globalization and technology and it's made people angry and frustrated enough to look for scapegoats in the form of immigrants and vote against their own economic interest just to punish those in charge."

"@atomless FT reader's comment says it all ... pic.twitter.com/ebbyv5rjuj ' – Twitter (unlikely source, but brilliant comment in my opinion) " – Twitter

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Tweet of the Day: "@LucyMangan Friend says - it's like divorce. They think it's going to be brilliant but actually you end up in a flat above a chip shop."

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Diversion: "The Best Movie Presidents Ranked, in Honor of Independence Day: Resurgence" – Wired

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