An end to the volatility of the last few weeks was in sight this morning as it emerged that David Cameron would likely be staying on at number 10.
The City of London, delighted with the prospect of stability after recent uncertainty, wasted no time expressing its approval.
The pound surged, making its biggest one-day gain against the euro for two years.
The FTSE 100 of the 100 biggest UK registered companies climbed 1.2 per cent to 7000 after markets opened at 8am, in a vote of confidence for the continued austerity policies of the Conservative government.
Sterling leaped at 10pm following the exit polls and continued rising as results came in. Against the dollar it is now up 2 cents at $1.5498, traders said. The euro slumped against the booming pound by 1.54p to 72.46p.
Broadly, sterling moved in line with the results coming in and their effect on the spread betting markets predicting the outcome for the Tories.
Nick Parsons, head of European Markets Strategy at National Australia Bank was one of the many City workers helping clients through the night.
He said: “The market’s reaction is all about stability and continuity. We’ve had an extreme period of volatility in the run up to this election and now, at last, we are getting some certainty about the future.”
Matt Brief, head of dealing at spread betting group IG Index reported that it had been a “very busy” night, with heavy betting on the Conservative seats.
Mr Brief said: “They don’t even seem overly bothered that it’s not an outright majority for the Tories, investors just see a convincing win which is bullish for the markets.”
However, he cautioned that the EU referendum, which now looks inevitable, may take those gains down again.