By Carla Mozee, MarketWatch
U.K. stocks dropped Thursday, with investors taking a hands-off
approach as Britons head to the polls to vote in what's been called
the tightest general election in generations.
The FTSE 100 fell 0.8% to 6,877.28, with only 12 shares moving
higher. Among those, BT Group PLC and Aviva PLC advanced following
financial updates.
The mid-cap FTSE 250 , whose constituents tend to have greater
exposure to the U.K. economy, pulled back 0.5% to 17,332.13.
The pound (GBPUSD) was trading at $1.5205 versus $1.5247 late
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 either
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
(http://www.marketwatch.com/story/7-things-you-need-to-know-about-the-uk-election-2015-05-06)
"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.
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.
Back to stocks, BT shares rose 0.5% after the telecommunications
group's fiscal fourth quarter net profit beat expectations on
cost-cutting efforts and a boost from its sports TV channels
(http://www.marketwatch.com/story/bt-profit-lifted-by-cost-cuts-sports-channels-2015-05-07-24852536).
Aviva shares picked up 0.6% as the insurer posted a 14% rise in
first-quarter new business
(http://www.marketwatch.com/story/aviva-new-business-up-14-turnaround-on-track-2015-05-07),
and said its turnaround efforts are ahead of schedule.
But Wm Morrison Supermarkets PLC fell 1.9% following the
company's report of a drop in first-quarter sales
(http://www.marketwatch.com/story/morrisons-q1-sales-down-on-restructuring-costs-2015-05-07).
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