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Instant View: May seen short of majority in election exit poll
June 8, 2017 / 9:55 PM / 2 months ago

Instant View: May seen short of majority in election exit poll

Prime Minister Theresa May appears on a joint Channel 4 and Sky News general election programme recorded at Sky studios in Osterley, west London.Stefan Rousseau/Pool

LONDON (Reuters) - Prime Minister Theresa May's Conservative Party will fail to win a parliamentary majority in Britain's election, according to an exit poll on Thursday, a result that would plunge domestic politics into turmoil and could delay Brexit talks.

Following are comments from financial market analysts and political commentators.

DEAN TURNER, ECONOMIST AT UBS WEALTH MANAGEMENT

"Should the poll prove accurate, it is likely that the pound will give up the bulk of its post-election announcement gains. After this, retreating back to the low 1.20 levels versus the U.S. dollar is a very real possibility. Nevertheless, sterling has steadied following the initial sell-off and there are few signs that anxiety has spread into other markets just yet."

SAMUEL TOMBS, CHIEF UK ECONOMIST, PANTHEON MACROECONOMICS

"This exit poll is a thunderbolt that leaves only two outcomes realistically in play: a slender Tory majority or a hung parliament. The exit poll’s biggest error in the last two decades was in 2015 when it under-predicted the Conservatives’ seats by 14. We see the risks to the seat projection as evenly balanced, given that its estimate was slightly too high in the four previous elections."

LEE HARDMAN, CURRENCY ANALYST AT MUFG

"The market will be praying that this exit poll has got it wrong. Currency volatility is the best proxy for market fears. If the Conservative ship is sinking then the market will be looking for a life boat."

UK DEFENCE MINSTER MICHAEL FALLON, ONE OF MAY'S MINISTERS

"Let's see some actual results to see if this is borne out - this is a projection, I think you made that clear, it is not a result. These exit polls have been wrong in the past, in 2015 they underestimated our vote. I think in a couple of elections before that they overestimated our vote. So we do need to see some actual results before we interpret this one way or the other."

ALAN CLARKE, HEAD EUROPEAN FIXED-INCOME STRATEGY, SCOTIABANK

"There has got to be a good chance that (May) stands down as prime minister in this environment. The betting websites have Boris Johnson as 2:1 to be the next prime minister after Theresa May."

GEORGE OSBORNE, FORMER UK FINANCE MINISTER

"It is early days. It's a poll. If the poll is anything like accurate this is completely catastrophic for the Conservatives and for Theresa May. It's difficult to see, if these numbers were right, how they would put together the coalition to remain in office. But equally it's quite difficult looking at those numbers to see how Labour could put together a coalition so it's on a real knife edge."

PAUL HOLLINGSWORTH, ECONOMIST, CAPITAL ECONOMICS

"The economy looks set to face a period of uncertainty about the outlook for policy, Brexit and the possibility of another election. Admittedly, the exit poll could yet be proved wrong."

KATHY LIEN, MANAGING DIRECTOR, BK ASSET MANAGEMENT, NEW YORK

"It wouldn’t be out of the realm of possibility to see pound/dollar drop below $1.26 or even $1.25. All of the sterling crosses are down. All of that is significant."

JORDAN ROCHESTER, FX STRATEGIST, NOMURA

"This is the hung parliament territory, it's also what we had for the last election pretty much, but then the real numbers on the night came up with a majority, so it's not over yet, folks. But we possibly have the Labour + Scottish National Party + Liberal Democrat coalition possibility in play here. But it’s still hard to form a coalition with Labour + others here, given their total only reaches the same number more or less than that of the Conservatives."

CRAIG ERLAM, ANALYST WITH BROKERAGE OANDA IN LONDON

"A hung parliament is the worst outcome from a markets perspective as it creates another layer of uncertainty ahead of the Brexit negotiations and chips away at what is already a short timeline to secure a deal for Britain."

Reporting by UK bureau; Compiled by William Schomberg; editing by Guy Faulconbridge

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