Equities on both sides of the Atlantic advanced as the latest polls suggest British voters might now opt to keep the country in the European Union in a Thursday referendum.

Following last Thursday's murder of Jo Cox, a pro-EU British member of Parliament, support for a Brexit appears to have faded. A weekend poll showed 45 percent of voters support the UK's ongoing membership of the EU, while 42 percent backed a Brexit-a British exit from the European Union.

"The momentum for Brexit was so strong and it was suddenly broken, which caught everyone by surprise," Christian Gattiker, head of research at Julius Baer Group in Zurich, told Bloomberg. "We were steering into a clear Brexit scenario and now we've seen a counter move which makes it more balanced, more in line with what investors thought in the first place."

In 12.01pm New York trading, the Dow Jones Industrial Average climbed 1.1 percent, while the Nasdaq Composite Index rallied 1.5 percent. In 11.46am trading, the Standard & Poor's 500 Index advanced 1.2 percent.


The New Zealand share market ended 22 points higher on the S&P NZX 50 Index yesterday at 6869 and most Asian markets were firmer. Late in the Australian trading day, the S&P ASX 200 index had gained 1.3 per cent.

By itself, the exit of Britain from the EU is not seen as having major ramifications for New Zealand.

However, the effects could start to mount up if other countries in the EU follow suit and trade barriers are resurrected, against the backdrop of the protectionist policies put forward by US presidential candidate Donald Trump.

Together UK and Europe account for about 14 per cent of New Zealand's trade.
Economists expect to see a sudden downturn in the UK economy if it votes to leave the EU. How far beyond the UK it would extend is open to conjecture.

The UK is still a reasonably significant trading partner for New Zealand, though not as important as it used to be.

Britain remains an important market for lamb, wine and pipfruit industries.
"But significantly, a Brexit outcome could quickly spill over into Europe," ANZ said in a commentary.

There would likely be pressure for copy-cat referendums in other nations, feeding populist movements in France and Italy, the bank said.

In the US overnight there were gains in shares of Boeing and those of Goldman Sachs, up 2.7 percent and 2.1 percent respectively, which helped lead the Dow higher. As of midday trading in New York, shares of Verizon Communications were the only Dow stock to trade lower.

Iran has reached a deal to buy 100 planes from US plane producer Boeing, and the two sides are awaiting approval by US Treasury authorities, according to state-owned news reports citing the head of Iran's Civil Aviation Organisation.

"The final obstacle in this area are only the permits from the US Treasury Department," Ali Abedzadeh told the state-owned newspaper Iran in remarks published on Sunday, according to Al Jazeera.

"We have been engaged in discussions with Iranian airlines approved by the USG about potential purchases of Boeing commercial passenger airplanes and services," Boeing told CBS News. "We do not discuss details of ongoing conversations we are having with customers, and our standard practice is to let customers announce any agreements that are reached. Any agreements reached will be contingent on US government approval."

Meanwhile, Boeing is nearing a US$4 billion deal with Russia's largest air-freight company-AirBridgeCargo Airlines and its Moscow-based parent, Volga-Dnepr Group-that would help extend the life of the 747 jumbo jet amid waning demand for four-engine aircraft, Bloomberg reported, citing people close to the transaction.

In Europe, the Stoxx 600 Index ended the day with a surge of 3.7 percent from the previous close. The UK's FTSE 100 index added 3 percent, Germany's DAX index rose 3.4 percent, while France's CAC 40 index gained 3.5 percent.

There's further volatility ahead.

"If I had a seatbelt while watching the markets, I'd put it on," Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh, told Reuters. "It's still a very close call, but this at least gives the markets a little bit of hope."

Before Thursday's referendum, investors will focus on US Federal Reserve Chair Janet Yellen who is scheduled to give her semi-annual testimony before the Senate Banking Committee on Tuesday, and again before the House Financial Services Committee on Wednesday.

with Jamie Gray