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The pound and shares have surged after the Conservatives won a clear majority in the UK general election.
Sterling gained 2.1% to $1.34 – its highest level since May last year – on hopes that the big majority would remove uncertainty over Brexit.
The pound also jumped to a three-and-a-half-year high against the euro.
On the stock market, the FTSE 100 share index rose 0.8%, while the FTSE 250 – which includes more UK-focused shares – leapt 5% in early trade.
Prime Minister Boris Johnson said the election result meant that the Conservative government “has been given a powerful new mandate, to get Brexit done”.
Mr Johnson has pledged to take the UK out of the European Union by 31 January.
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Politically sensitive shares saw sharp rises in early trading on UK markets.
Shares in water companies such as Severn Trent, which faced the possibility of nationalisation under a Labour government, shot up 10%, while UK housebuilders also saw big gains with a massive 14% rise for Persimmon.
Shares in Barclays, RBS and Lloyds were up 7% and 12% and 15% respectively.
The financial bookies had already installed Boris Johnson as the favourite, but did not expect him to romp home by such a distance.
The pound moved sharply higher as soon as the exit poll was published and went on to post one of its biggest one-day gains against the dollar in nearly three years.
Ian Tew, sterling trader at Barclays, told the BBC that Johnson’s decisive victory had “removed a layer of uncertainty”.
That is well put – there are many other layers for the markets to now focus on. The challenge of completing a trade deal with the EU by this time next year is formidable and traders on the Barclays floor are already muttering about the prospect of a new Scottish independence referendum.
Markets have given the prospect of a government with a functioning majority a round of applause, but at time of writing, the value of the pound is already beginning to retreat from the highs it hit overnight.
Pound v Dollar