Nigel Farage's Reform UK party seized hundreds of council seats across England on Friday, overturning Labour majorities in former mining and industrial towns and forcing Prime Minister Keir Starmer to publicly rule out resignation as long-dated U.K. government bonds pulled back from a multi-decade selloff.

With 50 of 136 English councils declared by midday in London, Reform had picked up 382 seats, according to Al Jazeera, while Labour had lost 264 and surrendered control of eight councils. The vote covers about 5,000 seats and will not change the makeup of the Westminster parliament, but it has rattled gilt markets that spent the past week pricing the odds of a Starmer ouster.

What shifted

Reform took outright control of Newcastle-under-Lyme and Havering, won 24 of 25 seats in Wigan and Leigh and ended 47 years of Labour dominance in Tameside, sweeping all 14 seats Labour was defending there. The Conservative Party, led by Kemi Badenoch, shed 183 seats even as it recaptured Westminster Council from Labour. The Greens added 29 seats and the Liberal Democrats 31.

Starmer digs in

Speaking in West London on Friday morning, Starmer called the results "really tough" and acknowledged voter frustration with "the pace of change" but rejected calls to step aside. "Labour was elected to meet those challenges, and I'm not going to walk away … and plunge the country into chaos," he told reporters. "It was a five-year term I was elected to do, [and] I intend to see that through."

Labour backbenchers are expected to press for a departure timetable if losses extend into Wales and Scotland. Health Secretary Wes Streeting, former Deputy Prime Minister Angela Rayner and Greater Manchester Mayor Andy Burnham have been named as likely successors. Starmer's standing has also been damaged by the dismissal of Peter Mandelson as ambassador to Washington over his ties to the late convicted sex offender Jeffrey Epstein.

On the Street

The yield on the 10-year gilt fell almost 6 basis points to 4.888 percent by 10:38 a.m. in London, with 20- and 30-year yields down 9 and 8 basis points, respectively. The 30-year gilt traded at 5.628 percent, against 5.8 percent earlier in the week and roughly 5 percent three months ago, Dan Coatsworth, head of markets at AJ Bell, said in a note. Long-dated U.K. borrowing costs touched their highest level since 1998 earlier this week.

Deutsche Bank analysts led by Jim Reid wrote Friday that markets were watching "whether PM Keir Starmer will remain in post," because "a new Labour leader might ease the fiscal rules and raise gilt issuance." The U.K. already carries the highest government borrowing costs in the Group of Seven.

The counterpoint

Farage, whom NBC News described as a Trump ally, framed the night as "a truly historic shift in British politics" and said Labour was being "wiped out by Reform in many of their traditional areas." CNBC reported that an Ipsos survey conducted weeks before the vote found cost of living was the dominant voter concern, the substantive ground Reform has worked while pushing tighter immigration controls.

Full results from the English councils, the Welsh Senedd and the Scottish parliament are expected by Saturday afternoon.