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Markets in red as investors stay cautious on UK election shock

The exit polls, showed that Theresa May's Conservative Party could fail to win a clear majority

Pranati Deva  |  New Delhi 

NSE
NSE

trade in negative as investors remained on sidelines on UK election shock after maintained status quo as expected and testimony of was without fire.
 
The exit polls, however, showed that Prime Minister Theresa May's Conservative Party could fail to win a clear majority, a shock result that would plunge domestic politics into turmoil and delay Brexit talks.

 
At 11:50 am, the S&P BSE was trading at 31,161, down 52 points, while the broader Nifty50 was ruling at 9,629, down 18 points.
 
The broader market were trading flat with S&P BSE Midcap down 0.2% while the S&P BSE Smallcap up 0.1%.

"With flag pattern showing not much inclincation to mature, the potential for a slippage needs to be factore in. Hence, though the 9,727/50 objectives are still in play, they are slowly emerging as resistances that the ongoing uptrend is felt intimidated by. Such a construct would be corroborated if 9,640 is overcome, which will be the pivot for the day," said Geojit Financial Services in a note.

Meanwhile, oil prices fell after data showed that a surprise surge in US crude inventories and Brent settled at its lowest since November 29, the eve of an OPEC production cut deal.

Buzzing Stocks

Reliance, Cipla, Coal India and Power Grid gained the most on BSE while Infosys, Wipro, TCS lsot the most.

fell around 3% after reports that founders are exploring a sale of their entire 12.75% stake in the company worth about Rs 28,000 crore. 

Tata Consultancy Services gains 0.73% as annual report showed its revenue were higher that its parent Tata Sons otehr its subsidiaries at over Rs 2,400 crore boosting its top line growth marginally. 

No majority for May?
 
election gamble may not reach the expected end as exit polls predict that she may not be able to get majority in Thursday’s polls which would plunge domestic politics into turmoil and delay Brexit talks.
 
According to the exit pools, the ruling Conservatives would claim 314 seats in the 650-member parliament and the opposition Labour Party 266, leaving no clear winner, according to a Reuters report.
 
With no clear winner likely to emerge from Thursday's vote, a wounded May vowed to provide stability, while her Labour rival Jeremy Corbyn said she should step down.
 
maintains status quo
 
The maintained status quo on deposit rate at -0.4%, in line with the analysts’ expectations and said that it would continue asset purchases at a pace of 60 billion euros a month until at least December. The sees inflation at 1.5% this year, down from a previous forecast of 1.7%, still short of its target of close to 2%.
 
In its statement announcing its policy decision, the central bank dropped wording that it could lower interest rates further, a sign of greater confidence in the economy, which is growing at a two-year high.
 
Comey Testimony
 
Former FBI head Comey on Thursday told US lawmakers in a congressional hearing he had no doubt that Russia had meddled with the 2016 presidential elections. However, Comey did not make any major disclosures about any links between Trump or his associates and Russia, an issue that has dogged the president's first months in office and distracted from his policy goals such as overhauling the US healthcare system and making tax cuts.
 
Global Markets
 
Sterling spiralled lower in Asia on Friday after British elections seemed to have left no single party with a clear claim to power. The pound shed almost three US cents in hectic trade, or close to 2%, while futures for the FTSE lost 0.5% on speculation the left-leaning Labour Party might actually be able to form a coalition government.
 
The damage was limited elsewhere, with Japan's Nikkei adding 0.3% and MSCI's broadest index of Asia-Pacific shares outside Japan was barely changed.
 
Overnight, Wall Street had seemingly judged the testimony of former FBI director was not life-threatening to the administration of President Donald Trump.
 
The Dow rose 0.04%, while the S&P 500 gained 0.03% and the Nasdaq Composite added 0.39%.
 
(with inputs from Reuters)

First Published: Fri, June 09 2017. 11:50 IST
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