Conclusion: What we have is a hung parliament and right now, the Conservatives are trying to work a deal with the Liberal Democrats to either form a coalition, or gain their support for a minority government.
Those negotiations begin in earnest tonight. If they fail, expect the Liberal Democrats to turn to the Labour Party to form some sort of “Coalition of the Losers.”
What this means for the UK is that there will be a second election sometime soon, as there is no clear winner in this Parliament. Uncertainty reigns, and that is having a significant impact on markets.
We’ll keep you up to date with any dramatic developments throughout the weekend.
10:45 – The Score: Conservative, 305; Labour, 258; Liberal Democrats, 57
10:17 – The Score: Conservative, 304; Labour, 257; Liberal Democrats, 57
Four to go, but only three of those will appear today.
10:15 – The FTSE is now falling on the uncertainty that is still reigning over the UK. Its down around 1.5%
9:50 – Conclusion from Cameron – Let’s work together with the Liberal Democrats in a coalition, but if we can’t the Conservatives should have a minority government.
The BBC is speculating that the Liberal Democrats may want to remain out of government with the Conservatives, but allow them to govern, supporting them on key issues.
Or the Liberal Democrats could choose a coalition with the rejected Labour Party.
Everything is still up in the air.
9:42 – Cameron is emphasising the Conservative – Liberal Democrat fight against the deficit. That should be a boon to markets.
9:40 – Cameron is now making very direct overtures to the Liberal Democrats, for a “open, trusting partnership.”
9:30 – David Cameron is now set to speak about the progress of negotiations with the Liberal Democrats. It will be vague, but should reveal whether progress can be made on the key issue, proportional representation.
If progress can’t be made there, the Liberal Democrats may turn to Labour and try to form a minority coalition government. Such an arrangement would be very unstable and could lead to a new election very soon.
The Score: Conservative, 301; Labour, 255; Liberal Democrats, 56
9:15 -The UK is in complete political chaos right now. There is no clear winner, though there is a clear leader in David Cameron’s Conservatives.
The Liberal Democrats under leader Nick Clegg are now pushing for the Conservatives to take power, as they have won the most seats in the Parliament.
Clegg also seems to be gunning for some sort of coalition with the Conservatives, whether that is necessary is still uncertain:
Labour, 253; Conservative, 299; Liberal Democrats, 54
Some constituencies have yet to report, but its obvious the Conservatives have won the most seats. They now have a chance to form a government. That government may have to be in coalition with the Liberal Democrats, who will insist on electoral reform in any coalition.
Labour, under Prime Minister Gordon Brown, has clearly lost. It is now unlikely Labour and the Liberal Democrats will be able to form a coalition with more seats than the Conservatives. Gordon Brown, speaking at 8:45 EST, has made clear he still thinks it could happen but is supporting Conservative and Liberal Democrat negotiations.
What this means for markets: Things will be uncertain through the weekend, with a conclusion unlikely until sometime Saturday, if not later. This will make the pound somewhat volatile, though a Conservative lead is a positive for the pound.
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