'It could be a rout': JAMES BURTON digs in with the traders as the election drama unfolds

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The City had been expecting a quiet election. Although hedge funds had taken large bets on a fall in sterling, most traders on the currency floors predicted a solid Tory majority.

Trading floors such as ETX Capital, where I spent the night as votes were counted, are open around the clock, doing business with UK clients and traders in Asia.

All is quiet until the stroke of 10pm, when the TV stations published their exit poll.

Big night in: ETX Capital traders watch the election results roll in

In the corner of a vast room filled with computer screens, a large TV flashes red as the pound plunges. 

There's a collective gasp. No panic. These traders have already worked through the Brexit night fall which wiped 12 per cent off sterling, and the Flash Crash. Besides, they don't believe the exit poll.

'It's early days yet, so let's see what happens as the results come in,' said analyst Neil Wilson. Others on the Square Mile have already lost their nerve and a one-minute sell-off sends the pound down 1.5 per cent to below $1.28.

Still the traders wait. And 45 minutes later, as the first two seats declare – Newcastle and Sunderland – the pound starts to nudge up as results suggest Labour may not win as many seats as the exit poll predicted.

For two hours, trading stops and starts. Occasionally a client rings to seek assurance that they're not about to lose thousands. At 1am, though, it's clear the exit poll was right. The trickle of phone calls becomes a flood. It's not quite panic, but the talk is frenzied.

As Labour gains more seats sterling drops to $1.27. Alarms sound across the floor as clients sell sterling heavily. Small margins, a cent here or there, can mean huge losses or gains. 'It could be a rout,' one trader says.

It's only quelled by a glut of results at 3am as it looks like the Tories will still be the biggest party. By 5am all deals are made.

Incredibly the night's activity does not even register as the biggest overnight fall in the pound in the past year. 

Where once this night shift was the dead zone, now it's at the heart of all the nation's Brexit uncertainty.