Why the UK election matters to the rest of the world

Oh, how analysts worried ahead of UK elections.

They were certain voters would fill Parliament with extreme political factions making it tough to form a new government, much less keep one together.

They feared the election would reshape Britain’s global role, having ripple effects around the world.

But Britons have bedeviled expectations. There will be no changing horses in mid-stream.

Prime Minister David Cameron is poised to retain his office at 10 Downing.

What does the UK election results mean for the rest of the world?

It means stable global markets … for now

Markets love political steadiness. And it showed Friday. The British pound was rising versus all major global currencies and the U.K.’s main stock market index jumped by 2% in early trading.

“It averts the risk of a tilt towards leftist policies under a Labour government relying on (Scottish National Party) support,” Berenberg chief economist Holger Schmieding said.

Cameron is credited for Britain’s recovery from recession: The U.K. enjoyed the fastest growth of any major developed economy last year, and unemployment has fallen rapidly.

“There is one elephant in the room and that is the EU referendum,” said Tim Besley, professor of economics at the London School of Economics.

It means the possibility of an exit from the EU

Who hasn’t heard the term “Grexit?”

It refers to the possibility of Greece getting out of the Euro as a result of its disastrous economy. That could take a wrecking ball to Europe’s financial markets, worst-case analyses have said. Europe’s economy could hit the skids, and the U.S. economy would follow.

Now, with Conservatives, also called Tories, gaining even more power in the UK, enters the possibility of a “Brexit.” Even though Britain does not use the Euro, it would be a much, much bigger wrecking ball.

Prime Minister Cameron has promised the country a referendum in 2017 on whether to stay in the European Union or to exit out of it.

“It’s hugely risky,” said British political analyst Robert Hazell.

Cameron has a reputation as a moderate conservative, but much like Republicans in the United States, he has his own version of the Tea Party.

Ultraconservatives want out of the European Union, Hazell said. “I’m sure that Cameron would like Britain to remain within the EU, but the rebels will hold his feet to the fire.”

The referendum will happen, he believes, and the results would be unpredictable.

It means fears of a fractured country

Speaking of referendums, many Scots want to split from Britain and tried to with a vote last year. It failed, but the sentiments showed up big in Friday’s vote.

The Scottish National Party swelled from a cottage party to the third largest elected power in parliament. “The Scottish lion has roared this morning across the country,” said former SNP leader Alex Salmond.

Scots have traditionally found their political home in Britain in the center-left Labour Party, which took huge losses in the vote, as Scots looked for a voice of their own.

There have been rumblings in the British press that a big win for the SNP could lead to yet another referendum in 2016.

Many Scots also don’t like the Conservative sentiments against the EU, where they’d like to stay.

In an extreme scenario, Britain could leave the European Union, triggering Scotland to leave Britain, and join the EU.

“This means that we would have a dis-united Kingdom in an EU which will keep the same number of member states,” said former Italian Prime Minister Mario Monti, “but of course with Scotland replacing the UK somewhat diminishing overall integration.”

It could make the European Union more of a jigsaw puzzle.

It means clamping down on immigration

Immigrants from strife-torn nations have looked to Europe, including the U.K. for a second chance at life. But the Cameron government has made them feel less welcome in recent years.

Indeed, the Conservatives campaigned on control immigration and capping welfare.

Among its platforms, “Introducing a new citizen test with British values at its heart.”

Conservatives have been pushed further to the right by another party, the UK Independence Party, or UKIP, which is anti-immigration and unfriendly towards Islam.

UKIP picked up electoral gains, which will not make them a power in parliament but may get their voices heard more by Conservatives afraid of losing to them in the next election.

“Although people will portray this as as a great Conservative victory – and against the expectations it is – Cameron’s problems now are only just beginning because, if he’s only got a very small majority, he’s going to be in hock to the extreme right wing of his party,” said Professor Robert Hazell, of University College London.

This right wing includes 10 to 20 “repeat rebels” who could cause Cameron major headaches, he said.

It means diminishing influence globally

There was a time when the United States had an influential ally in Britain. But lately, Britain hasn’t been pulling its weight. It’s increasingly taken a back seat to Germany, where Chancellor Angela Merkel has emerged as the go-to European leader in tending to world affairs.

British leaders have hardly said a word as the EU struggles to keep financially-strapped Greece afloat. They’ve left that to Merkel. Ditto when it comes to acting as the intermediary between Kiev and Moscow over Ukraine. Merkel’s taken the lead on that as well.

Don’t expect that to change.

During the campaign, Cameron and his opponents talked incessantly about domestic policy. Foreign policy? Not so much.

CNN’s Alanna Petroff contributed to this report.