U.K. Election: What Does This Mean for Brexit?

U.K. Election: What Does This Mean for Brexit?

THE British pound has plunged against all major currencies in the wake of the shock UK election on Thursday, which looks likely to deliver a hung parliament.

The pound lost more than 2 cents against the US dollar within seconds of the exit poll result, falling from $US1.2955 to $US1.2752 late Thursday. It later recovered slightly, to $US1.2780. One Australian dollar currently buys 58.97 British pence, up from 58.20 pence at the close of the previous session.

Meanwhile, the Australian share market has recovered from its earlier losses as the miners rally and concern around the UK election eases.

At midday AEST, the benchmark S&P/ASX200 index was up 0.22 per cent with the mining sector offsetting big losses in the energy stocks with companies hit by uncertainty around oil supplies.

Analysts said markets were jittery in morning trade on signs British prime minister Theresa May’s Conservatives would likely lose their majority. However, by midday, concern over possible implications for wider markets had eased.

The Australian dollar also fell in early morning trade amid the news from the British general elections, but has since recovered some ground. At 1200 AEST, the local unit was worth 75.36 US cents, down from 75.50 US cents on Thursday.

On the local share market, BHP Billiton, Rio Tinto and Fortescue Metals were up by more than one per cent each, while energy players Woodside Petroleum, Oil Search and Santos were each off between 1.3 per cent and two per cent. Major healthcare companies have also rebounded from a sluggish early session with Cochlear up 0.5 per cent, ResMed gaining 0.30 per cent and CSL 0.18 per cent higher.