German stock market sees biggest drop since 2008 crash

News that British voters had opted to leave the EU led to panic in Germany's largest stock index.

German stock market sees biggest drop since 2008 crash
Photo: DPA

It was the biggest shock to the Frankfurt-based DAX – a stock market index consisting of 30 major German companies – since 2008, the year of the global financial crisis.

In recent days markets became convinced Britain would vote to stay in the EU and had rallied as a result.

But after the results were confirmed before the opening of the trading floors, the financial index dropped 10 percent before rising slightly later in the morning, meaning an overall 8 percent drop.

“Everyone was in the wrong place,” one trader said. “Nobody was betting on Britain really leaving. Now there is a huge need to safeguard.”

Since the middle of the previous week the DAX had risen 9 percent on hopes that Britain would stay in the EU.

Banks were particularly hard hit. Deutsche Bank and Commerzbank both lost between 15 and 16 percent of their value. Allianz shares dropped by 13 percent.

But energy companies RWE and Eon which both have large investments in the UK were also affected.

“In the stock market you always need to think the unthinkable,” said market expert Daniel Saurenz, adding that traders had failed to do this in recent days.

German bond prices soar as investors seek Brexit safety

German government bond prices rose sharply on Friday as money poured in from investors seeking safety after Britain voted to leave the European Union.

This pushed the yield on the benchmark ten-year German government bond into negative territory for only the second time in its history, to -0.14 percent.

Yield differentials across the Eurozone, known as spreads, widened, with yields rising in the currency bloc's weaker southern economies.

The Greek government bond yield rose to 9.4 percent early Friday, traders said.

The Leave campaign won the referendum on Thursday with a vote of 52 percent to 48 percent, according to the BBC.

Voter turnout reached 72 percent with over 30 million people casting their ballots.

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‘It’s their loss’: Italian universities left off UK special study visa list

The UK is missing out by barring highly skilled Italian graduates from accessing a new work visa, Italy's universities minister said on Wednesday.

'It's their loss': Italian universities left off UK special study visa list

Universities and Research Minister Cristina Messa said she was disappointed by the UK’s decision not to allow any graduates of Italian universities access to its ‘High Potential Individual’ work permit.

“They’re losing a big slice of good graduates, who would provide as many high skills…it’s their loss,” Messa said in an interview with news agency Ansa, adding that Italy would petition the UK government to alter its list to include Italian institutions.

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“It’s a system that Britain obviously as a sovereign state can choose to implement, but we as a government can ask (them) to revise the university rankings,” she said.

The High Potential Individual visa, which launches on May 30th, is designed to bring highly skilled workers from the world’s top universities to the UK in order to compensate for its Brexit-induced labour shortage.

Successful applicants do not require a job offer to be allowed into the country but can apply for one after arriving, meaning potential employers won’t have to pay sponsorship fees.

Students sit on the steps of Roma Tre University in Rome.

Students sit on the steps of Roma Tre University in Rome. Photo by TIZIANA FABI / AFP.

The visa is valid for two years for those with bachelor’s and master’s degrees and three years for PhD holders, with the possibility of moving into “other long-term employment routes” that will allow the individual to remain in the country long-term.

READ ALSO: Eight things you should know if you’re planning to study in Italy

Italy isn’t the only European country to have been snubbed by the list, which features a total of 37 global universities for the 2021 graduation year (the scheme is open to students who have graduated in the past five years, with a different list for each graduation year since 2016).

The Swiss Federal Institute of Technology, EPFL Switzerland, Paris Sciences et Lettres, the University of Munich, and Sweden’s Karolinska Institute are the sole European inclusions in the document, which mainly privileges US universities.

Produced by the UK’s Education Ministry, the list is reportedly based on three global rankings: Times Higher Education World University Rankings, the Quacquarelli Symonds World University Rankings, and The Academic Ranking of World Universities.

Messa said she will request that the UK consider using ‘more up-to-date indicators’, without specifying which alternative system she had in mind.