With results in for all but one seat in the U.K. election, it’s now certain that U.K. Prime Minister Theresa May’s gamble to consolidate her power has failed.

Votes have been counted in 649 of the 650 total constituencies, and May’s Conservative Party has won 318 seats. That’s well short of the 326 seats needed for a majority and a far cry off the 400-plus seats it was forecast to win a month ago. The U.K. is headed for a hung parliament, where no single party has a majoity — which means it may be very hard to pass legislation.

Read:U.K. election — what is a hung parliament?

The result has taken markets by surprise, sinking the pound GBPUSD, +0.01% to a seven-week low of $1.2740. Sterling traded around $1.2950 before the first exit polls came out.

Here are some of the initial reactions from analysts, some of which came in before the loss of the Conservative majority was confirmed:

• “A hung parliament increases domestic uncertainty and clearly complicates the U.K.’s position at the upcoming EU negotiations. In the near term, the market may reflect this via a weaker pound, but we would caution against chasing cable lower from here.”

“Today’s result will in part be seen as a vote against a definitive break from the EU, and the market may soon begin to reassess the probability of a so called hard Brexit. A Tory minority may have to make concessions in the direction of a softer exit... Brexit risks and current account related stress are key factors behind our bearish sterling view; today’s result has the potential to reduce those risks and may warrant less sterling depreciation than we originally thought.”

— Global macro strategists at UBS

• “From a market perspective, a hung parliament is seen as one of the worst possible outcomes to this election because it just injects further uncertainty into the United Kingdom as it heads into Brexit negotiations with the European Union.”

“The whole reason for the unexpected announcement of a snap election from Theresa May was to gain a more dominant hand when representing the U.K. in negotiations, but this outcome would suggest it has backfired and ultimately will result in the door being opened even wider when it comes to the U.K. entering further political uncertainty.”

— Jameel Ahmad, FXTM vice president of market research

• “A hung parliament is the worst outcome from a markets perspective, as it creates another layer of uncertainty ahead of the Brexit negotiations and chips away at what is already a short timeline to secure a deal for Britain. GBPUSD fell more than 2% immediately after the exit poll and looks very vulnerable to further downside.”

— Craig Erlam, senior market analyst at Oanda

Read:What will U.K. election result mean for Brexit?

• “The biggest upset in British politics since last June. Betting markets now make Jeremy Corbyn the favorite to become the next prime minister — a situation few investors had really contemplated. Indeed it’s fair to say markets had been a little complacent about this result.”

Even if the Tories squeak a majority, it looks like Theresa May is toast, adding yet more uncertainty. As previously stated, we now have the rather absurd scenario where May could be ousted for winning the most seats and Jeremy Corbyn’s position strengthened by coming second again.”

— Neil Wilson, senior market analyst at ETX Capital

• “Markets might perceive the near-term uncertainty to be worse than it was after the Brexit vote. However, if a hung parliament forces a cross-party compromise it could lead to a softer Brexit strategy, and may turn out to be positive in the long run after some serious initial confusion...”

“With the strong chance that parliament could not form a consensus on key issues, the decision may even be thrown back to the voters, either through a second referendum on Brexit or a repeat election.”

— Kallum Pickering, senior U.K. economist at Berenberg

U.K. Election: What Is a Hung Parliament?

• “It would seem as though markets are relatively optimistic about the formation of a Tory-led government. If this assessment changes, sterling is vulnerable to a further sell-off. Of course the irony is that the government’s attempt to engineer a long period of stability has achieved precisely the opposite.”

— Phillip Shaw, chief economist at Investec

“It looks certain that Theresa May will be in trouble even if she just about squeaks a majority, or is able to form a government with the support of the Ulster Unionist parties.”

“The campaign has highlighted her severe deficiencies as a leader and there is no doubt that her authority in the Conservative Party has been significantly diminished. Even if she remains PM, it is unlikely to be for long.”

— Grant Lewis, head of research at Daiwa Capital Markets.

• “Following results of the general elections, we expect U.K. risky assets to come under pressure, as markets will start pricing in a scenario of high political uncertainty, a growth slowdown and possibly disorderly Brexit. Over the last week, the FTSE 250 MCX, +1.43% was moderately down, but it is still trading at its historical highs, so the room for a sell-off is ample.”

“We expect Gilts to rally in the short-term, but the medium- to long-term reaction will depend a lot on developments on the political front and on Brexit negotiations.”

— Daniel Vernazza. chief U.K. economist, UniCredit Research

• “The emergence of a Labour-led coalition could trigger a bearish environment for gilt yields. As the market prices in campaign promises of fiscal stimulus and a softer-Brexit, we believe that gilt yields could be on course for a sustained upward move over the medium term.”

— Bill Street, head of investment for EMEA at State Street Global Advisors