Things can only get better, can't they?

Over the past 10 hours the results rolled in, snacks have been eaten and there is an overwhelming Labour majority in the 2024 UK General Election with more than 410 seats declared for them.

The LibDems have won the most seats ever for many decades, proving the anti-Conservative murmurs that started in 2021 as 'Partygate' unfolded grew to a crescendo through the cost of living crisis and the disastrous era of the Lettuce-Kwarteng "mini-Budget" of 2022.

Sixteen front bench ministers have lost their seats, including Liz Truss, and now we have a new governing party, coming into the election with what the former shadow chancellor - no doubt to be named as actual chancellor - Rachel Reeves - stressed was a "fully costed manifesto".

During the first days of campaigning after soaked Sunak precipitated the nation into a July 4 election, Labour unveiled a plan which, they say, was 14 years in the making. 

It said: "Our plan for Britain is a fully costed, fully funded, credible plan to turn the country around after 14 years of the Conservatives. It contains a tax lock for working people – a pledge not to raise rates of income tax, national insurance or VAT."

Labour has to avoid the temptation to come in like a lion

This contrasts with the warnings of former chief secretary to the Treasury Laura Trott, who told the dwindling Tory party faithful they'd "better start saving now" because Labour was coming for "your car, your house, your schools and your pension". 

Scaremongering words, and perhaps these warnings have been lurking at the backs of Britons' minds, even as they swung their votes away from the Conservatives towards Labour (or to Reform).

But with promises to maintain the triple lock, build at least 300,000 homes a year, implement a wide-ranging pension review and improve Britain's creaking social care services, we're now all hoping Labour will come good on these promises, without deepening the debt burden of the UK.

So what are the next steps, apart from making sure your middle-class clients stop buying avocados and lattes so they can put more aside to cover the VAT on school fees?

Quite frankly, there are four main steps to follow now. They all carry the same message.

Wait. 

Wait for the new cabinet to be formed, so that we can see who will be the ministers responsible for housing, pensions, social care and the like.

Wait until the next Budget, which should be held in mid-late September at the earliest.

Wait for the Office for Budget Responsibility, which will now need at least 10 weeks' notice to start preparing its fiscal analysis and forecasts before the new government can hold a Budget (hence September is the earliest we can expect Starmer-Reeves' first Budget). 

Wait to see whether any legislation that had already started to go through parliament to help reform regulation and financial services will be abandoned or will continue its journey once parliament is back. 

That's a lot of waiting, and generally, financial services companies and consumers alike do not like having to wait. 

Positive glimmers?

But perhaps there might be some hope in the form of market movements over the next couple of days. 

Sterling has continued its incremental strengthening against the US$ - up a minuscule amount again to 1.2769 today as at 8am this morning (Friday July 5).

Likewise, the stock market remained buoyant, with the FTSE 100 holding around 8,270 at market opening today, compared with 8,241.26 at close yesterday (July 4).

As a bellwether of sentiment, it seems markets are unbothered by the Labour landslide. 

Indeed, as Lindsay James, investment strategist at Quilter Investors said, markets have had the best part of three years to get comfortable with the idea of a Labour government.

She says: "With political turmoil hitting other developed economies at the same time, this huge majority may present the UK to investors as somewhat of a political safe haven – a known quantity that should give businesses confidence in the environment they operate in.

"If Labour can present an energetic vision of a new centrist government that enjoys considerable breadth of support, it should be a good starting point for the domestic economy.”

Clearly, the economic backdrop is still fragile. The UK has a large fiscal deficit, the debt to GDP ratio is wide and the gilt market is more sensitive than a tube of Colgate. 

This means Labour has to avoid the temptation to come in like a lion. The scale of their win gives them, as James pointed out, a mandate to "reprioritise and reshuffle existing spending and taxation meaningfully".

Whether they do this in a way that supports and grows the UK economy over the next four to five years remains to be seen. 

For now, the old mantra rings true: stay calm, and carry on.

simoney.kyriakou@ft.com