Theresa May failed to secure a majority for the Conservative party in Thursday’s election, creating further uncertainty for the UK as it begins its Brexit negotiations.
May called an election in April to strengthen her Conservative majority, allowing her a stronger mandate to negotiate Brexit. However after a fierce campaign from Labour the Conservatives have failed to gain a majority, with voters waking up on Friday to a hung parliament.
The pound has fallen as investors take stock of the situation, trading around 2 percent lower against the dollar and 1.7 percent against the Euro overnight.
However the FTSE has risen, currently trading up 0.60 percent at 7,494.62 (0936GMT).
Tom Stevenson, investment director for personal investing at Fidelity International, said:
“Theresa May’s electoral gamble has catastrophically failed. After a difficult election campaign during which her claims of a strong and stable leadership sounded increasingly hollow, she has not only failed to increase the Government’s small parliamentary majority but lost it altogether.
“The market reaction to this unwelcome outcome is likely to hit UK shares, bonds and the pound. Markets will likely remain on the back foot while the difficult job of putting together a workable government is undertaken.”