United Kingdom exit poll: Conservatives may fall short of majority

The Australian dollar is weaker in early Asian trade, falling in response to exit polls showing that no party will win a majority in the House of Commons after the United Kingdom general election.

Britain's voters have delivered a stunning blow to Prime Minister Theresa May, wiping out her parliamentary majority and prompting calls for her to resign. A high turnout is seen as Labour's best hope of eroding the Conservative majority.

"At this time the country needs a period of stability".

"A very very strong mandate for our prime minister, and of course it should be the leader with the most seats in the House of Commons who can win the necessary votes, and Theresa May is in that position today".

It was devastating result for May, who had called the election three years earlier than required by law, convinced by opinion polls that placed her far ahead of opposition Labour Party leader Jeremy Corbyn. The Conservatives, already ill at ease after a gaffe-prone campaign, will ask how she could squander the commanding lead that she enjoyed at the start of the campaign.

With a handful of seats still to be declared, the Conservatives were predicted to win 319 seats, down from 331 in 2015 - yet another upset in a turbulent year since the European Union referendum in June 2016. That's short of the 326 seats she needs for an overall majority.

Labour are expected to increase their share from 229 to 260 seats, resulting in a hung parliament.

SNP leader and First Minister Nicola Sturgeon said it had been a disappointing night for her party, while Scottish Conservative leader Ruth Davidson said Sturgeon should take the prospect of a second independence referendum off the table.

The projections throw up big questions about Brexit.

Early newspaper editions reflected the drama, with headlines such as "Britain on a knife edge", "Mayhem" and "Hanging by a thread".

Alex Salmond, the SNP's former leader and the former head of Scotland's devolved government, was among those who lost their seats, along with the leader of the SNP's lawmakers in the London parliament, Angus Robertson.

May began the Brexit process in March by triggering Article 50 of The Lisbon Treaty, the country has two years to negotiate the tangled European Union divorce proceedings.

Labour deputy leader Tom Watson said the party would hold Mrs May to her campaign statement that if she lost six or more seats she would no longer be Prime Minister.

"It creates another layer of uncertainty ahead of the Brexit negotiations", said Craig Erlam, senior market analyst at OANDA currency traders.

"Investors were concerned that May was not very business friendly, that she was only listening to a handful of acolytes and that we would lose [Philip] Hammond [the Chancellor] who has been a voice of reason".

"She is a damaged Prime Minister whose reputation may never recover". May said this week that she would consider rewriting human rights legislation if it gets in the way of tackling extremism.

  • Carolyn Briggs