Australia faces hung house

With 78 per cent of votes counted, a hung parliament was most likely, with two possible scenarios for a minority government: a conservative administration backed by rural independents or a Labor government backed by Green or green-minded MPs.

The latter scenario is frightening for many investors, with Prime Minister Julia Gillard indicating on Sunday after early talks with independent and Green MPs that she was open to discussing the policies of this disparate group of lawmakers.

“It is my intention to negotiate in good faith an effective agreement to form government,” said Gillard. Her Labour Party was better placed to deliver a stable government.
Conservative leader Tony Abbott also met some crossbench MPs on Sunday.
“I have spoken briefly to each of the three independents. I don’t want to pre-empt the discussions that I expect will be held over the next few days,” Abbott said.

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Australian PM vows stability