Wake Smith chairman Nick Lambert looks at the latest Brexit news...
The General Election concluded with a widely unexpected landslide for the Conservative Party, resulting in a Parliamentary balance of power, which could not be more different to the previous one.
The net result of this historic majority win, is that the Prime Minister now has the ability to drive his Brexit plans through the House of Commons, with little by way of impediment.
This means that the UK will definitely leave the EU on 31 January, with the next stage of tough negotiations on the specifics of a trade deal with the EU to begin immediately after.
To further strengthen the UK's negotiating stance with the EU Boris Johnson has announced in the first 48 hours of Government, that the post-Brexit transition period end date of December 2020 will be enshrined in law.
The date can currently be extended for a further two years by mutual agreement, but through an amended Withdrawal Agreement Bill, which the Commons is set to vote on this week, that extension will be nullified.
This raises the stakes somewhat and means that the possibility of a departure from the EU without a deal is a very real possibility, putting immense pressure on the EU to agree terms in a very short time-frame.
Another immediate effect of the general election result has been a dramatic improvement in shares coupled with the pound surging to a three-and-a-half-year high against the euro.
On the stock market, the FTSE 100 share index rose 1.1 per cent and the FTSE 250, which incorporates many UK-centric shares, also hit record highs.
Shares which have been sensitive to political uncertainty saw rapid rises across UK markets.
Domestic construction businesses quickly gained, with Barratt shares up by 14 per cent and Persimmon 12 per cent improved.
Utilities companies, which faced the possibility of nationalisation under a Labour government, including Severn Trent Water, rose by nine per cent.
Property experts, Knight Frank LLP, were also quick to comment that the election result is expected to unleash more schemes and investment in commercial property in 2020, buoyed up by greater political certainty and a very attractively-priced UK real estate market.
Politically, the Prime Minister still faces criticism from opposing political parties which lobbied for closer ties with the EU, but there will be little that can deviate the Government from its chosen path, as evidenced by the immediate ruling out of another Scottish referendum.
We can therefore expect the same objections reported across the media, but for businesses at least, the general election result has provided some certainty, with a majority Government able to move on from the political deadlock that has hampered UK commerce for the past three and a half years.
This should allow for business planning and growth to resume, with businesses also able to prepare for the certainty of Brexit to ensure that any negative impacts are minimised.
