He said: “The pound will take the strain initially but a more redistributive and left-leaning government is a distinct possibility, which is unlikely to be particularly supportive for risk assets. We are about to live in interesting times.”
Eugene Philalithis, portfolio manager of Fidelity Multi Asset Income, said three months into the Article 50 timeline, which dictates we must exit the European Union within two years, it is now unclear who will conduct negotiations on behalf of the UK or even what those negotiating will aim to achieve.
Mr Philalithis said: “While negotiations are unlikely to begin in earnest before the German elections, this is not the backdrop that anyone will have wanted.”
Nigel Green, the founder and CEO of deVere Group, said rather than securing a bigger mandate for Brexit as she assumed she would, Mrs May’s gamble has backfired hugely.
He said: “With Theresa May’s job now surely on the line, just as the UK is set to begin Brexit negotiations, and a clear shift in voting dynamics across Britain, there is yet another enormous storm cloud of uncertainty about who will lead talks and how they will do so.
“Indeed, we’re entering into a perfect storm of chaos and the uncertainty is set to unleash mayhem across global financial markets, at least in the short term, as they react to the growing question marks hanging over the British parliamentary landscape.
“Volatility is the only certainty in these uncertain times. But, of course, volatility can also bring considerable opportunities and investors should avoid knee jerk reactions at this time.”
emma.hughes@ft.com
