FACTORIES across Europe enjoyed a buoyant month in June but that growth could be under threat after Britons have voted to leave the European Union, surveys conducted almost entirely before the historic referendum showed.

    Highlighting another worrying trend for the global economy, China’s vast factory sector flatlined as exports shrank and jobs were cut, in a slowdown across Asia that could lead to yet more policy stimulus as doubts grow over the potency of measures taken so far.

    The hard times signaled by a range of surveys was not what the world needed a week after Britain voted to leave the EU, condemning the bloc to months if not years of political and economic instability.

    “The unimaginable has happened and the United Kingdom vote will cast a long shadow over the United Kingdom, Europe and global markets for some time to come,” warned Westpac head currency strategist Robert Rennie.

    Markit/CIPS reported a surprisingly strong reading of 52.1 in June for their U.K. Manufacturing Purchasing Managers’ Index (PMI), up from May’s 50.4. That was the strongest reading since January and better than all forecasts in a Reuters poll of economists, which produced a consensus view of 49.9.

    But data company Markit warned “almost all” the data from manufacturers used in its survey were received before the June 23 referendum.

    “Leaving the EU threatens the loss of 50 free trade agreements with other countries, as well as restricted access to the single market itself,” said Samuel Tombs at Pantheon Macroeconomics.

    “In short, then, the UK’s meager manufacturing sector — which accounts for just 10 percent of GDP — is not going to prevent the overall economy slipping into recession.”

    June was also stronger across the eurozone, where factory activity expanded at its fastest rate this year as discounting helped drive up new orders and output, encouraging companies to hire more people to meet the demand.

    “However, eurozone manufacturers will be worried that demand in both domestic and foreign markets could be significantly weakened by heightened uncertainty following the United Kingdom’s vote,” said Howard Archer at IHS Global Insight.

    The Bank of Japan found major manufacturers in a morose mood despite all its attempts at aggressive easing.

    The reasons were clear in the Markit/Nikkei measure of Japan’s PMI, which edged up slightly to 48.1 in June but stayed in contractionary territory for the fourth straight month.

    News from South Korea was relatively cheery as its PMI reached a six-month high, yet at 50.5 it was just barely into expansionary territory.

    India’s PMI did hit a three-month high but it remains an outlier in an Asian region which could face a whole new threat should the Brexit vote herald a wider retreat from free trade.

    (SD-Agencies)