The fallout from Britain's seismic vote last week to leave the European Union has tanked global stock markets, prompting one analyst to recommend one key strategy: patience.
Michael Hewson, chief market analyst at CMC Markets, based in London, said investors should wait until the dust settles before making any major moves with their money.
"I think you just have to wait for things to settle down," he said. "In terms of European stocks, it's the banking sector that's once again getting clobbered, not only in the UK, but across Europe. Deutsche Bank (DB) - Get Report has hit another record low and trading of Barclays (BCS) - Get Report and Royal Bank of Scotland (RBS) - Get Report got suspended on Monday."
Even though the Dow Jones Industrial Average lost 600 points on Friday, the blue-chip index dropped only 1.6% for the week. The broad S&P 500 still remains above 2,000. After falling 8 percent against the dollar on Friday, the pound was down 2% on Monday to roughly $1.32, nearing $1.30.
Hewson said the last time the pound was at $1.30 was in the 1980s. "The pound is likely to continue to remain under pressure, as are European and UK banks," he said, referring to the uncertainty over how the UK will exit the European Union.
Meanwhile, Bank of England Governor Mark Carney and Federal Reserve Chair Janet Yellen decided not to attend a European Central Bank panel in Portugal on Wednesday, where the central bank leaders would have likely faced questions about the Brexit vote.
"Mark Carney has other things to worry about given the decline in the pound," Hewson said. "Yellen probably doesn't want to field any questions about the timing of the next rate rise."
Hewson thinks a 2016 rate hike is off the table. The Fed holds its next policy meeting at the end of July.