LONDON – The FTSE 100 in London climbed 0.6 percent to 7,493.36 after the general election in the U.K. left Prime Minister Theresa May with fewer Conservative members of parliament and no majority, an inconclusive result that could weaken her hand in future negotiations with the European Union.
The FTSE’s rise was fueled by the fall in the pound, which was down 2 percent against the dollar at $1.27, and 1.7 percent against the European currency at 1.14 euros, following the result that saw the Tory party fall 10 seats short of a majority.
The Conservatives won 316 seats, but needed 326 seats to secure a majority. Labour won 261 seats in the election after an overall voter turnout of nearly 69 percent, 2.6 percent higher than in 2015.
May has vowed to press on as prime minister and plans to seek permission from Queen Elizabeth II to form a new government, if she can strike a deal with the Democratic Unionist Party of Northern Ireland.
May called the election six weeks ago in a bid to gain more Tory MP seats and strengthen her hand in Brexit negotiations, saying she needed a clear mandate from the British people before dealing with the European Union.
She gambled on the snap election when her ratings were high, but her campaign faltered on a variety of fronts, and Labour moved in to gain 29 seats for a total of 261.
The FTSE MIB in Milan was up 0.6 percent to 21,158.38, followed by the DAX in Frankfurt, 0.2 percent to 12,737.73, and the CAC 40 in Paris, 0.1 percent to 5,267.47.
The euro traded at $1.12, while the pound fetched $1.29 and the Swiss franc equaled $1.03 at 10:25 a.m. CET.
Retail and luxury stocks were uneven, with the morning’s biggest gainers including Burberry Group, 2.4 percent to 17.60 pounds; Geox, 1.8 percent to 2.91 euros; Asos.com, 1.4 percent to 62.68 pounds and Jimmy Choo, 1.2 percent to 2.04 pounds.
Among the stocks to lose the most ground were Primark parent Associated British Foods, down 2.5 percent to 28.98 pounds; J. Sainsbury, 2.7 percent to 2.60 pounds; Italia Independent Group, 4.4 percent to 5.16 euros; Debenhams, 2.3 percent to 0.47 pounds; Next, 3.8 percent to 41.85 pounds; Marks & Spencer Group, 3.3 percent to 3.55 pounds; and Unilever, 1.3 percent to 50.15 euros.