government collapse fears leave investors eyeing another UK election

Jason Alden | Bloomberg | Getty Images

A broker looks at financial data on computer screens on the trading floor at ETX Capital, a broker of contracts-for-difference, in London, U.K., on Friday, June 9, 2017.

Despite weathering a particular nasty political storm in recent months, U.K. leader Theresa May and her weakened government still has many market participants on edge with the potential for another election still a distinct possibility.

According to Joan Hoey, the Economist Intelligence Unit’s regional director for Europe, there is “considerable risk of the (U.K.’s) government collapsing.” May’s slender 3-seat majority, forged only through a compromising, expensive deal with the Democratic Unionist Party, could well “disappear quickly as a result of by-elections that will occur,” Hoey explained.

The U.K. prime minister marked one year since she took the country’s helm Thursday, while stoic socialist and opposition leader Jeremy Corbyn visited Brussels to meet with major European players in Brexit negotiations.

Adding to the jostle for power between the two politicians, a YouGov poll released last Friday denoted Corbyn with an eight point-lead over his rival May, rubbing salt into the wound of her loss of a government majority in last month’s General Election. The shifting fortunes of the Labour and Conservative leaders have left voters – and investors – wondering when the U.K. will hold its next vote.