Woodford, who used to look after funds worth nearly ?25bn for Invesco Perpetual before forging out on his own to form Woodford Investment Management, believes Theresa May will now adopt a more stimulative position ? given her lack of a mandate. With 318 seats, eight below the required amount for a majority in parliament, May and the Conservatives appear to be going into a coalition of sorts with Northern Irish party the Democratic Unionist Party (DUP) ? which itself won eight seats in the election. ?In all the heat and light that accompanies an unexpected political outcome, a lot of extreme conclusions have been discussed by market and media commentators,? Woodford said. Based on May not having a mandate, Woodford added: ?That, in my mind, will mean that the new administration will embrace a looser fiscal strategy going forward ? borrowing more and spending more. Overall, this will be positive for the perspective of UK economy growth.? Woodford also thinks the Conservatives will, in partnership with the DUP, function ?effectively?. ?In wooing an alliance partner, the Tories will have to offer some concessions and I would imagine the DUP will be keen to secure an open border with Ireland as an important part of those negotiations,? he added. ?Membership of the EU Customs Union could be seen as a minimum requirement if a deal is to be struck with the DUP and, in turn therefore, the probability of a softer Brexit outcome has risen.? A delay to Brexit negotiations is unlikely, he said, with nothing important expected to be concluded on that front until after the Germans have their election in September. The same ?knee-jerk reaction? that played itself out following the Brexit vote has, he explained, boosted the share prices of the large dollar-earning businesses that dominate the UK stock market. Commentators around the country have predicted severe market uncertainty in the fall out of the general election, one which was thought to produce another majority government for the Conservatives before a strong Labour campaign and poorly-received Tory manifesto changed the political scene. Unlike when Donald Trump was elected president of the US in November 2016, when Woodward described it as a ?vote against political establishment?, it appears the investor does not believe the British vote will have as far-reaching an impact. Back then he said: ?As much as this election result is a vote for Trump, in my view, it is also a vote against the political establishment from a large part of society that is angry that policy has done little to help it since the global financial crisis.? May has already met with the Queen to discuss her intention to form a new government with the DUP, after which she will need to calm the nerves and anger of her own party members. However, Woodward remained bullish, and concluded: ?If anything, with its implications for looser fiscal policy and a softer Brexit, the election result has made me even more optimistic about the UK economic outlook.?
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