Shock exit poll shows Tory gains - Investec

FXStreet (Bali) - The Investec Economics Team (London) takes a closer look at the shocking UK exit polls, which shows a major divergence in Tory gains against what was expected based on all the polls from recent weeks.

Key Quotes

"The polling stations have now closed and we have just had the main exit poll, which is truly astonishing. In terms of seat projections it shows Con 316, Lab 239, Lib Dem 10, SNP 58, UKIP 2, Plaid 4, Green 2, Others 19. If correct this would mean that the Tories have done much better than expected (and Labour and the Lib Dems a lot worse), with the Conservatives actually increasing their seat tally from 2010. Hence the Tories would be very close to an overall majority and would be there with the help of the remaining Lib Dems."

"Sterling is rallying strongly, and this would also be very stockmarket positive. However, and it is a very big however, IT IS ONLY AN EXIT POLL and may not be accurate (especially as it is predicting seats not votes), although in fairness they typically are. We are waiting for the first of the 650 seats to be declared at around 10.40pm or so – this is usually Houghton and Sunderland South and followed by two other results nearby in the north east. However other declarations may be few and far between until after midnight with a large number of results due at around 2.00. One interesting contest will be Lib Dem leader Nick Clegg in Sheffield Hallam – the re-formation of the Con-Lib coalition will be much easier if he holds on to his seat."

"Our next note will be published at around 07.00, by which time we should have a good idea of how the parties have fared, and perhaps who will form the next government."

GBP/USD keeps surging, en-route to 1.55

GBP/USD keeps surging, currently at 1.5445/50 from the 1.52 handle not long ago, following the shocking UK exit polls, which shows ruling government and its leader Cameron likely to remain the Prime Minister.
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Treat UK exit poll shocker with some degree of caution - Nomura

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