Shock UK exit poll suggests Britain's May fails to win majority

The exit poll predicted May's party would not win a majority of the 650 seats in parliament to take office alone, meaning she would have to form a coalition or attempt to govern with the backing of other smaller parties.

The pound lost more than 2 cents against the dollar within seconds of the exit poll result, plunging from $1.2955 to $1.2752 late Thursday.

The exit poll pointed to an extraordinary failure for May, who was enjoying opinion poll leads of 20 points and more when she called the election.

"A hung parliament is the worst outcome from a markets perspective as it creates another layer of uncertainty ahead of the Brexit negotiations", said Craig Erlam, a market analyst with brokerage Oanda in London.

But the campaign shifted to welfare issues, favouring Corbyn, and to May's record on security after terror attacks struck London and Manchester.

Shock UK exit poll suggests Britain's May fails to win majority

If confirmed, the result will be a disaster for May, who called a snap election in the hope of increasing her majority and strengthening Britain's hand in exit talks with the European Union.

Former Conservative chancellor George Osborne told ITV News the forecast was "completely catastrophic" for the Tories and Theresa May.

Investors worry that a minority Conservative government would be weaker in Brexit talks, which start on June 19 and are to last for at least the next two years.

The Labour party will get 266 seats, while 14 will go to Liberal Democrats, 34 - to the Scottish National Party and 22 to other political forces. May had been expected to win comfortably.

Labour leader Jeremy Corbyn is expected to claim the outcome as a stunning vindication of the party's lurch to the hard-left under his tenure.