Turnbull Scrambles for Critical Support From Independents in Close Election

Vote counting was still underway from the July 2 ballot, but Prime Minister Malcolm Turnbull said his conservative Liberal Party-led coalition had secured a victory, and that opposition leader Bill Shorten had called him earlier to congratulate him on being re-elected.

The Coalition is confident it will win the 76 seats required to form a majority government and could win 77 seats if the counting of postal and absentee votes continues to trend its way.

In scenes reminiscent of the 2010 federal election where balance of power negotiations extended for 17 days, none of the major parties won a clear majority in the House of Representatives on election night.

The latest projections by the Australian Broadcasting Corporation shifted two seats into the government's column, giving Turnbull's Liberal-National coalition 70 out of 150 lower house seats, and the centre-left Labor opposition 67.

Lacking a strong mandate, whoever leads Australia could be hamstrung in efforts to revitalize the world's 12th-largest economy.

Standard and Poor's cut Australia's credit rating outlook to negative from stable on Thursday, threatening a downgrade of its coveted triple A status, over fears.

When Prime Minister Malcolm Turnbull sat down for a Greek coffee with the Liberals' victorious Julia Banks in the Melbourne seat of Chisholm, his slopped coffee was greeted with a cheer.

While the Coalition is now leading the election count, 73 seats to Labor's 68, a few thousand postal votes across about five remaining "too close to call" seats will be the decider.

Both the two other independents, Tony Windsor and Rob Oakeshott, who backed the Gillard Government, retired at the 2013 election and failed in their bids to return to parliament at last weekend's election.

"It's likely in coming days that the Liberals will scrape over the line but the combination of a PM with no authority, a government with no direction and a Liberal Party at war with itself, will see Australians back at the polls within the year", Shorten told a party gathering in Canberra.

The Australian dollar fell half a United States cent after S&P's announcement, which cited concerns the coalition government would be hampered in its plans to return to Budget surplus as it struggles to form a majority government. Another seven seats were in doubt.

"It's something we should celebrate and not take for granted", Mr Turnbull said.

Those who backed Mr Turnbull are surely now wondering why they went to all that bother to lose a dozen seats or more.

Katter's backing means he would get behind the government on budget matters and on votes of no confidence.

Labor's Leisa Neaton is less than 180 votes ahead of sitting Coalition MP Michelle Landry with 82.3% counted.

"That is why we have been able to maintain our position, which has been remarkable", he said.

"We will be campaign-ready from this day onwards", he said.

"So, for those that want to cause maximum mayhem in the parliament we won't be part of that", said Xenophon.

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