Pound jumps as exit poll shows Tories may retain power

[LONDON] The pound jumped as an official exit poll showed that the Conservative Party will get the most seats in the UK's general election, reducing the prospect of protracted negotiations over the formation of the next government.

Sterling strengthened at least 0.8 per cent versus all of its 16 major counterparts as the survey of voters indicated Tory leader David Cameron is set to lead the largest party, just short of a majority, in a hung Parliament. Its rally versus the dollar was the largest in almost seven weeks.

In the run-up to the election, the Conservatives focused on their economic credentials, with polls showing them to be the the most-trusted party on that subject.

The British currency rallied 0.9 per cent to US$1.5389 at 11.50 p.m. London time, the biggest jump since March 20. It appreciated 1.3 per cent to 72.98 pence per euro, taking its gain versus the 19-nation shared currency this year to 6.4 percent.

The FTSE 100 Index of stocks may open 70 points higher if the exit poll proves accurate, Joshua Raymond, chief market strategist at City Index in London, wrote in a Tweet. The index closed at 6,886.95 on Thursday, the lowest since April 2.

BLOOMBERG