Stock markets and the pound rose sharply on Friday after Boris Johnson’s Conservatives secured a resounding general election win.
The FTSE 250 index of mid-sized UK firms surged 4 per cent to an all-time high on hopes that Mr Johnson will swiftly bring an end to the Brexit deadlock.
Sterling jumped 2.1 per cent to $1.34 and hit €1.20 against the euro, its highest level against the single currency since the immediate aftermath of the Brexit referendum.
Companies have held off investment since the June 2016 referendum as the UK remained in political and economic turmoil over its future relationship with the EU.
While Mr Johnson’s government still has to negotiate a trade deal with the EU, investors interpreted his comfortable election victory as one that will bring stability.
1/10 Jo Swinson – Liberal Democrat
Leader of the Liberal Democrats lost her Dunbartonshire East seat in a 6.8% swing to the SNP
PA
2/10 Dennis Skinner – Labour
Labour MP of 49 years Dennis Skinner lost his Bolsover seat to Conservative Mark Fletcher, losing 16% of the vote share
PA
3/10 Anna Soubry – The Independent Group for Change
Leader of The Independent Group for Change, formerly Conservative MP, Anna Soubry lost her Broxtowe seat, coming third behind the winning Conservatives and Labour
PA
4/10 Dominic Grieve – Independent
Prominent Remain-backing MP Grieve lost the contest for Beaconsfield, coming second to the Conservatives, his former party
AFP/Getty
5/10 Luciana Berger – Liberal Democrat
Luciana Berger lost the contest for Finchley and Golders Green, coming second to Conservative Mike Freer
PA
6/10 Laura Pidcock – Labour
Prominent Corbyn ally Laura Pidcock lost her Durham North West seat to Conservative Richard Holden
PA
7/10 Chukka Umunna – Liberal Democrat
Prominent anti-Brexit MP Chukka Umunna lost the contest for the Cities of London & Westminster, coming second to Conservative Nickie Aiken
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8/10 Zac Goldsmith – Conservative
Former candidate for Mayor of London Zac Goldsmith lost his Richmond Park seat to Liberal Democrat Sarah Olney
PA
9/10 Nigel Dodds – DUP
Former leader of the DUP Nigel Dodds lost his Belfast North seat to Sinn Fein
AFP/Getty
10/10 Gareth Snell – Labour
Labour MP Gareth Snell lost his Stoke-on-Trent central seat to the Conservatives
PA
1/10 Jo Swinson – Liberal Democrat
Leader of the Liberal Democrats lost her Dunbartonshire East seat in a 6.8% swing to the SNP
PA
2/10 Dennis Skinner – Labour
Labour MP of 49 years Dennis Skinner lost his Bolsover seat to Conservative Mark Fletcher, losing 16% of the vote share
PA
3/10 Anna Soubry – The Independent Group for Change
Leader of The Independent Group for Change, formerly Conservative MP, Anna Soubry lost her Broxtowe seat, coming third behind the winning Conservatives and Labour
PA
4/10 Dominic Grieve – Independent
Prominent Remain-backing MP Grieve lost the contest for Beaconsfield, coming second to the Conservatives, his former party
AFP/Getty
5/10 Luciana Berger – Liberal Democrat
Luciana Berger lost the contest for Finchley and Golders Green, coming second to Conservative Mike Freer
PA
6/10 Laura Pidcock – Labour
Prominent Corbyn ally Laura Pidcock lost her Durham North West seat to Conservative Richard Holden
PA
7/10 Chukka Umunna – Liberal Democrat
Prominent anti-Brexit MP Chukka Umunna lost the contest for the Cities of London & Westminster, coming second to Conservative Nickie Aiken
Getty
8/10 Zac Goldsmith – Conservative
Former candidate for Mayor of London Zac Goldsmith lost his Richmond Park seat to Liberal Democrat Sarah Olney
PA
9/10 Nigel Dodds – DUP
Former leader of the DUP Nigel Dodds lost his Belfast North seat to Sinn Fein
AFP/Getty
10/10 Gareth Snell – Labour
Labour MP Gareth Snell lost his Stoke-on-Trent central seat to the Conservatives
PA
The stronger pound particularly helped housebuilders, which will see rising revenues and falling costs because they generate sales in the UK and buy raw materials overseas.
Persimmon soared 12.9 per cent, while Barratt Homes, Crest Nicholson, Taylor Wimpey, Redrow and Bellway also rose.
On the FTSE 100, utility companies made strong gains after fears of nationalisation under a Labour government evaporated. SSE rose 9.5 per cent and Centrica was up 7.7 per cent.
Travel firms also performed strongly. “A perky pound means it is cheaper to travel abroad than would have otherwise been the case, something which could benefit tour operators and travel agents,” said Russ Mould, investment director at AJ Bell.
“This is not to say that all of the challenges which face these sectors or their constituents will immediately melt away.”
Craig Erlam, senior market analyst at OANDA Europe, said: “It doesn’t take a genius to guess which companies are flying this morning after that election result.
“Remove the threat of nationalisation and investors quickly flock back to the BTs, Royal Mails and National Grids of the world. And there’s plenty more. Investors in these companies will be breathing a huge sigh of relief this morning.”
Domestically focused banks including Barclays, Lloyds and Royal Bank of Scotland jumped. Exporters, which generate revenues in foreign currencies, lost out.
Helal Miah, investment research analyst at The Share Centre, said the stock market’s reaction had been “mixed”. mixed.
“Understandably, the more UK-centric stocks in the FTSE 250 are up at the open around 2 per cent, but the FTSE 100 dominated by the global multinationals has actually opened lower by over half a per cent.
“However, the utilities, which were under pressure beforehand, went into auction early on, but immediately when out of auction they all jumped significantly, reversing the half per cent loss to a half percent gain to the top 100.”
Additional reporting by PA news agency
