For all the doomsday talk, markets are taking Brexit pretty well

The Brexit fallout continues.

It's looking like Britain will not only lack a prime minister, but also a leader of the opposition. Jeremy Corbyn's MPs seem to want him out, even if the rank and file don't.

Meanwhile, many people have decided that they might be able to overturn a referendum via a petition (you can be snarky about this but perhaps one lesson is that in the online era, a little bit more online democracy might be something to consider).

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As for the EU, well, it's sticking to the "more in sorrow than in anger" line.

The politics is messy. It was always going to be. But what's the damage on the markets this morning?

The surprising resilience of markets

The FTSE 100 has opened lower, although it's staying above 6,000. The FTSE 250 is has been hit harder, dropping by 400 points, though it's still above Friday's opening low. Stocks in Europe are down too, but as of writing, not by a particularly noteworthy amount.

This is only to be expected. There's a lot of upheaval going on here.

What will Scotland do? What will Ireland do? What will the rest of Europe do? Who'll be the next Conservative leader? Who'll be the next Labour leader (don't count Corbyn out Marxists can be pretty good at holding on to power once they get it)? The political landscape could be reshaped radically by all of this.

It is worth pointing something out at this juncture, however: politics matters to markets, but it doesn't matter that much.

Here's what's happening in Britain. Whoever ends up in charge of all the parties, the government will remain centrist and broadly market friendly. If there is a recession, then markets might take a hit. Some stocks will be hit harder than others. But the central bank will remain on hand to print money, or lower interest rates (minutely), or do whatever it wants to do.

Sterling assets will remain denominated in sterling. A fresh Scottish referendum might concern investors in Scotland but if there's one thing I remember from the last Scottish referendum, it was the overwhelming lack of interest from 99% of investors in London.

So there's upheaval. But hard as it may be to believe, this isn't 2008-level upheaval. The banking system is solvent. The cash machines aren't running out of money (although the high street bureaux de change might be kicking themselves for not getting more euros in stock to sell to the punters at outrageously high margins).

This is a political issue, not a market issue. And as we've seen many times before, markets can cope with politics.

The one major political issue here that could transform into something more disruptive is the question of whether the eurozone stays intact. If the eurozone breaks up (and when I say breaks up, I mean the whole thing shatters, not just Grexit), then you have redomination risk, you have no idea who is creditworthy and who isn't that's a proper market nightmare.

But that's a long way off. And while it's been given added piquancy by the Brexit result, it was already a major issue, and it's possible that Brexit might even push the day further back (Brexit didn't seem to do much for Podemos in the Spanish elections, for example).

Markets will struggle to price all of this in, for sure. They will go through emotional highs when they think things are going to be OK and emotional lows when they can see nothing but dark days ahead.

But your job as an investor is not to sit there and second-guess the markets. It's to look for good value assets that have been sold off by your more panicky peers.

So, as I said on Friday (to the inexplicable consternation of some if the commenters below), don't panic. You should never panic as an investor. That's a surefire way to lose money. There will be a settlement at some point. Normal service will resume.

Don't be surprised if there's a second referendum

This doesn't mean that I want to see a second referendum. I'm just being realistic. Very few of the people involved want the status quo to change. They'd rather be part of the club.

And it's fascinating to see how rapidly the establishment lashes back. I don't much like Jeremy Corbyn. But as far as I can see, a substantial proportion of the rank and file "the people', if you like backed him and still do.

Yet the same people who couldn't get up the spine to depose Gordon Brown have finally pulled it together to have a mass revolt against Corbyn, now that the EU is under threat.

So whether you like the idea or not there will be machinations. This is the first step in a process, not a guillotine blow. If the outcome is a better deal for the UK within or outside of the EU I'll be happy. If it just ends up being a case of "let's vote again until you give us the right answer", I'll not be.

If you're concerned about how Brexit may affect your investments going forward don't worry. We've put together a special Brexit survival guide for you. We'll show you why Brexit is the beginning of what could be an extremely prosperous time for the country and for you. Here's how you can download it today.

Anyway, we'll be covering all the latest on Brexit and the opportunities arising from the fallout in the next issue of MoneyWeek magazine, out on Friday.