Hung Parliament possible after close Australian election result

Malcolm Turnbull on election night in Australia (Reuters)
Malcolm Turnbull on election night in Australia (Reuters)

Australia is at risk of its second hung parliament in six years, with no clear winner after Saturday's vote.

Neither of the major parties have secured the 76 seats for a majority government, with postal votes yet to be counted, meaning a hung parliament is still possible.

Opposition leader Bill Shorten is celebrating the strong swing towards his party.

"With our agenda we look forward to working with people, because we know that Australians are interested in what Labor was talking about in this election," he says.

After losing a lot of votes to Labor, Liberal leader and Prime Minister Malcolm Turnbull might retain leadership by a slim margin, but replacements for him are already being discussed.

Associate Professor of Politics Jennifer Curtin told Paul Henry if Mr Turnbull does win, he won't last the full term.

"There'll still be some seats that are very marginal, and the people that sit in those seats will want to know that they've got a leader for the full term that can deliver something stable."

The non-result has sparked calls from within the Liberal Party for Tony Abbott to return to the front bench.

"I'm not sure it'll go back to Abbott, even though the conservatives in the party might want to see him back," Ms Curtin says.

"Someone like Julie Bishop might come through the middle - she's really played her cards quite carefully."

Mr Turnbull insists Mr Abbott will not be returned to the ministry, if the Liberal-National coalition forms government.

"The ministry will be the same after this election as it is now," he told media. "We've lost a number of ministers… but I'm not proposing to bring back any particular individuals."

It could be the end of the week before its known who will govern.

In New Zealand, Prime Minister John Key says it's a challenging result, but he isn't concerned about Australia's Labor Party making a strong comeback.

He doesn't think the same thing will happen here.

"We've had stable, predictable leadership, we've been there for a long period of time - what you see is what you get. I think at a time when you see this uncertainty around the world, that's going to play well for us," he told Paul Henry.

Mr Turnbull says he remains "quietly confident" the Coalition will be able to form a majority government. Mr Key says Mr Turnbull could run a minority government, as that's what he does "every day of the week".

Mr Key says if Mr Shorten does win, "I'll be on my sixth Australian Prime Minister."

On local financial markets there could be more uncertainty this week because of the inconclusive election result.

Markets have already endured the upset of the Brexit result and are now braced for the fallout from Australia.