The British Pound benefits from the Conservative win
Friday, 13 December 2019
The British currency briefly went over the $1.35 mark for the first time since May 2018. Credit: Belga
Boris Johnson’s clear conservative victory in the general election delighted the British market on Friday with a leap in the value of the pound and share prices on the London stock exchange.
Investors had been gambling on a conservative majority for several days, hoping to see the UK’s exit from the EU quickly validated and lessen the uncertainty surrounding Brexit that has been poisoning the markets for years.
But they did not anticipate the Tories making such broad gains, which resulted in the pound sterling’s dramatic increase in value late on Thursday, once the initial estimates were known and later confirmed by the official results.
The British currency briefly went over the $1.35 mark for the first time since May 2018, the strongest leap in a decade. About 9:30 AM, it was worth $1.3476, a hike of 2.10%, and €1.2065 (+1.79%).
At the same time, stocks on the London exchange (the FTSE-100), went up by 7.347 points (+1.1%).
The conservative victory over Jeremy Corbyn’s labour party “brings clarity for investors where there was confusion before,” Neil Wison, an analyst at Markets.com, commented.
“For the markets and companies, it’s the perfect result, a clear conservative majority, the threat posed by Corbyn eliminated, a clear-cut reduction in the uncertainty surrounding Brexit and even a quick budget to support the economy,” the analyst recapped.