U.K. stocks fell on Thursday, with investors taking a hands-off approach as Britons headed to the polls to vote in what’s been called the tightest general election in generations.
The FTSE 100 UKX, -0.67% fell 0.7% to 6,886.95, in part on losses in the heavily weighted energy and basic materials sectors.
The midcap FTSE 250 MCX, +0.21% whose constituents tend to have greater exposure to the U.K. economy, however, pulled out a win, finishing up 0.2% at 17,447.96.
The pound GBPUSD, -0.1377% late Wednesday traded at $1.5224, down from $1.5247 Wednesday in New York.
Opinion polls point to the likelihood that the election will result in a hung parliament, where no party has a majority. The main political parties, the Conservative Party and the Labour Party, will likely have to negotiate with smaller parties to form a coalition government or reach an agreement for a minority government. Under a minority government, one party would lead, but find support on an issue-by-issue basis from another party. Read: 7 things you need to know about the U.K. election
The first indications of the election outcome won’t emerge until after polls close at 10 p.m. London time, or 5 p.m. Eastern Time.
“Watch out for the volatility,” on the pound, said Richard Perry, market analyst at Hantec Markets, in at note. “Cable is a tough call in the next two days with so many fundamental drivers,” including Friday’s U.S. jobs report for April.
Back to stocks, BT Group PLC shares BT.A, -0.26% finished 0.3% lower. They had been higher earlier Thursday after the telecommunications group’s fiscal fourth quarter net profit beat expectations on cost-cutting efforts and a boost from its sports TV channels.
Aviva PLC AV., +2.63% shares climbed 2.6% as the insurer posted a 14% rise in first-quarter new business, and said its turnaround efforts are ahead of schedule.
But Wm Morrison Supermarkets PLC MRW, -6.55% fell 1.6% following the company’s report of a drop in first-quarter sales.
GlaxoSmithKline PLC GSK, -4.46% shares fell 4.5% in the wake of the company’s decision to drop plans to create a separate company centering on drugs to treat HIV.
Source: MarketWatch
