The London Stock Exchange opened to slight gains on Friday, with the pound remaining steady, indicating a calm response to the Labour Party’s crushing victory in the British general elections.
The London Stock Exchange displayed a 0.36% rise, reaching 8270.61 points just before 09:30 (Belgian time), reflecting a trend similar to other European exchanges. Meanwhile, the composed pound climbed 0.05% against the dollar and slipped 0.04% compared to the euro.
“The Labour Party will form the next UK government but compared to 2019 this is accompanied by little noise in the financial markets,” noted Chris Beauchamp, an analyst at IG, a financial markets analyst. He pointed to the “unchanging sterling movement” as indicative of how much this victory had been expected.
The change of government has been eagerly awaited in the finance sector since the fleeting Conservative government of Liz Truss, which rocked the markets at the end of 2022 with a budget marked by tax cuts and extensive, unfunded spending.
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The new Prime Minister Keir Starmer “tried to appeal to markets during his election campaign by positioning Labour as a pro-business party and by refraining from announcing major tax increase plans,” investment analyst Victoria Scholar observed.
The City of London Corporation (which represents the powerful British financial industry) declared they were ready to assist the government on Friday to “promote growth, create more highly skilled jobs, and fund public services, or even combat the climate crisis.”
“The business sector will welcome an election outcome so clear-cut and an end to the political and economic instability of recent years,” commented industry lobbying group Make UK.
