The UK’s political scene – where one mainstream party looks on course to win a large majority – compares with other countries such as the US and France, where potentially volatile elections remain too close to call, analysts suggested.
Jane Foley, head of FX strategy at Rabobank, told Bloomberg: “Dull politics is good for investment.
“There could be a bit of a rally for sterling on the election results on the hope that we can see a few years of boring, stable politics, and therefore an improvement in investment growth.”
Dean Turner, an economist at UBS Wealth Management, said: “Whatever we think about the election campaign, the results, and what is likely to come after, it will provide the UK with some much-needed certainty.
“And this could be beneficial for UK assets if investors once again warm to the attraction of our markets.”
Financial markets will get the first clear signal on the final election result with the rest of the country at 10pm on Thursday, when broadcasters reveal the results of a major exit poll.
Amid doubts about how many seats the Conservatives will lose and an outside chance that the Liberal Democrats will secure enough to become the official opposition, Deutsche Bank suggested that the latter possibility could push a Labour government closer towards the European Union.
Ella Hoxha, head of fixed income at Newton Investment Management, told Bloomberg UK assets had “a positive political backdrop from an investment perspective so [they] are attractive”.
