Britain may need to ask for delay to Brexit process, says JPMorgan economist

Prime Minister Theresa May leaves Conservative Party HQ in Westminster, London, as her future as Prime Minister and leader of the Conservatives was being openly questioned after her decision to hold a snap election disastrously backfired. PRESS ASSOCIATION Photo. Picture date: Friday June 9, 2017. Photo:  Rick Findler/PA Wire
Prime Minister Theresa May leaves Conservative Party HQ in Westminster, London, as her future as Prime Minister and leader of the Conservatives was being openly questioned after her decision to hold a snap election disastrously backfired. PRESS ASSOCIATION Photo. Picture date: Friday June 9, 2017. Photo: Rick Findler/PA Wire
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Britain may have to delay Brexit talks in the absence of a majority for Prime Minister Theresa May’s Conservative Party, JPMorgan said.

With no clear winner emerging from the election, Mrs May signalled she would fight on, despite being on course to lose her majority in the House of Commons.

“Perhaps the most obvious conclusion is that the likelihood of the UK needing to request a delay in the Brexit process has risen substantially, given the chance that political developments in the UK disturb what is already a time-compressed process,” said Malcolm Barr, economist at JPMorgan, in a research note.

Patrick Connolly, a certified financial planner at Chase de Vere, said: “Last night we saw another surprising election result, following in the footsteps of last year’s EU Referendum and the election of Donald Trump in the US

“This result, with a hung parliament, causes uncertainty and could have an impact on stock markets, bond markets and currency markets as all generally hate uncertainty

“However, the impact of election results on stock markets tends to be short lived, as very quickly the uncertainty passes and stock market movements are again driven by global factors and general investor sentiment

“It should be remembered that the UK stock market has risen significantly since the EU Referendum result and the US market has risen since the election of Donald Trump

“The message for investors is very simple. While they may be feeling uncertain about what happens next, they need to remain calm and rational and understand that any short-term noise from the election result is likely to be just that, short-term.”

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