UK General Election 2017: investors urged not to panic

The shock General Election result might have thrown up a list of potential outcomes longer than Theresa May’s face this morning, but for long-term investors the message remains clear.

Investors have been urged not to panic buy or sell in the wake of this morning’s shock UK General Election result.

Theresa May’s Conservative party was widely expected to obtain an outright majority – it was why she called this election in the first place – but we’ve ended up with a hung parliament and no shortage of uncertainty.

And markets are no fans of uncertainty, with sterling falling more than 2% while the FT noted a “sharp divergence” in UK equity markets.

So what should you do? If you’re a long-term investor, nothing at all.

Retailers are being particularly punished in London trading right now https://t.co/4xFzRYTFxF #GE2017 pic.twitter.com/jNJ0Woiymn
— Bloomberg (@business) June 9, 2017

Take a strong and stable approach

While speculators may attempt to make short-term gains or pre-empt potential losses, Mark Dampier, head of Investment research at Hargreaves Lansdown, stressed there was no need to make “rash decisions”.

He added: “While the result is a surprise and may lead to another election later this year – market reaction has generally been subdued so far because the Tory Government will remain in power but a hard Brexit now looks less likely.

“There will be no dramatic changes in domestic policy immediately as there would have been under Labour had they got in.

“We have always advocated a level-headed, long-term approach to investing, and I would urge investors to resist the temptation to make short-term, knee-jerk reactions.

“We could see some volatility over the coming days as more details emerge about the new Government.

Business as usual

He added that, once a Government of some sort is in place, he expects the dust to settle fairly quickly.

“There will be a dawning realisation that everything has changed and nothing has changed.

“For the vast majority of UK companies it will be a case of “business as usual” on Monday.”

Drown out the noise

As was mentioned at the start, the latest shock political result to hit Britain throws up many, many questions.

No one knows a sure-fire way to capitalise on this event. Certainly, we’ve received hundreds of mails this morning from experts in every financial field telling people what to do with their money right now.

You could listen to them – and you may just make a hefty profit out of it – but if your investment strategy is focused on adding value over many years, you might just want to pause for breath for a minute.

Visit the loveMONEY investment centre (later, when everything’s calmed down)