FTSE could fall over 10 percent if UK votes to leave EU - UBS Wealth Management

Britain's benchmark FTSE 100 equity index could fall by more than 10 percent in the next year if the country votes this month to leave the European Union, UBS Wealth Management estimated on Thursday.

UBS Wealth Management added that, in contrast, a decision to stay in the EU could see the FTSE rise by up to 5 percent over the next 12 months.

"Should UK citizens vote to leave the European Union, we could see the performance of the FTSE 100 index fall by over 10 percent," said Caroline Simmons, deputy head of the UK Investment Office at UBS Wealth Management.

"The stock market valuation could drop closer towards valuations seen during the 2012 euro crisis, but this would be cushioned by an 8 percent boost to earnings from the weakness we foresee in the pound," she added.

UBS Wealth Management forecast sterling/dollar falling to 1.25 and sterling/euro down to 1.20 on currency markets if Britain voted to leave the EU.

While a YouGov poll published on Wednesday showed British voters evenly split between "Remain" and "Leave" ahead of the ballot, two surveys the previous day - one online and one conducted via telephone - showed British voters had moved towards voting to leave the EU.