Labour’s shift on Brexit referendum could worry markets

The bounce a second Brexit referendum could have on financial markets would be offset by a win by the United Kingdom’s Labour party, the chief executive of one of the world’s largest independent financial advisory groups has claimed.

The head of deVere Group’s, Nigel Green’s, concerns came after UK opposition leader, Jeremy Corbyn, put his support behind a second vote, which would make Labour more electable in the eyes of many voters.

“Since the beginning of the year a large and growing number of clients are telling our advisers that for their wealth they fear the damaging impact of a Jeremy Corbyn-led government more than Brexit,” Green said.

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“High-net-worth individuals in Britain and wealthy international investors with UK assets and business know that they will be hit by Mr Corbyn’s tax hikes on wealth, income and inheritance.

“As such, more and more of them are seeking advice on established, legitimate overseas opportunities to create, build, and importantly, protect their wealth.”

Green believed that a second referendum would be welcomed by financial markets, both reducing ongoing political uncertainty around Brexit’s outcome and increasing the chance of a softer Brexit. A more favourable Brexit could see the Sterling and British financial assets rally in relief, as well as a mini spurt in household and business spending.

“If it had been the government and not Mr Corbyn who shifted stance on a second referendum, the markets could have been expected to react far more favourably,” he finished.

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