Champagne corks pop in the City but rally may be brief

Sterling surges along with the banking and energy sectors as Conservatives make unexpectedly large gains in general election

In its way, the response of the stock market to the Conservative victory in the general election said it all about the British economy. Shares in banks, upmarket estate agents, outsourcing companies and firms employing plenty of zero-hour contract workers all surged. The City, property speculation and a service sector running on cheap labour: for all the talk of rebalancing, repeated by David Cameron on the steps of Downing Street, that's where the action is.

There was, of course, another reason why the Square Mile was running short of Dom Perignon: most of those working in dealing rooms stood to lose personally from a Labour government. They live in big houses, they would have been liable to income tax at 50% and they would have been hit by a bankers' bonus tax. Never has the phrase "relief rally" been more appropriate.

Related: City celebrations greet a home win as election results in Tory majority