Financial markets are abuzz with the early signs of a potential landslide victory for Labour in the general election. An exit poll conducted by Ipsos, including for Sky News, has indicated a substantial majority anticipated for Sir Keir Starmer’s party, aligning with pre-election forecasts.
Despite the closure of UK financial markets at 10 pm, the reaction to the exit poll can still be gauged through the trading of the pound in the Asia-Pacific region. Initial stability was observed in the pound’s value against major currencies like the dollar and euro, attributed to the widely expected Labour triumph already factored into market expectations.
Market analysts noted that the pound’s slight uptick against the dollar to $1.27 was more a reflection of the dollar’s weakness rather than newfound support for the pound. Against the euro, the pound made gains to reach €1.18 post the exit poll release.
Michael Metcalfe, head of macro strategy at State Street Global Markets, highlighted the neutrality of institutional investors towards the UK election, contrasting with heightened political risks in other countries like France and the US. The UK’s election outcome was deemed relatively predictable, keeping investors in a neutral stance.
Notably, the FTSE 100 and FTSE 250 indices closed Thursday’s trading on a positive note, signaling market optimism amidst the unfolding election scenario.
