The Labour Party's big win in the U.K.'s Thursday election will it see take charge of the country after over a decade of leadership from the Conservative Party.
Interest rates remain elevated in the U.K. as the central bank has battled high inflation following the Covid-19 slowdown.The two main political parties ran on different economic and financial manifestos during the election campaign that would likely have different consequences for the investing environment.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, broadly echoed McManus' comments in a note published this week, but added that there could be some impact on the economy. Some sectors — and therefore specific stocks — could also be affected, Streeter pointed out. Pressure could be added to the utilities sector as Labour plans to increase fines for water companies which are already being weighed down by high costs. Meanwhile, the party's pledge to boost the country's defense budget could see U.K. airspace stocks benefit from additional spending on new technology and equipment.
Wider economic developments will however also be a factor, according to Nutmeg's McManus. As interest rates are set to fall, so will mortgage rates, which could lead to more people buying or selling homes, he said adding that this could also have knock-on effects for other businesses like furniture and DIY shops.
In the longer-term, there are also not"huge risks" for the pound under a Labour government, Francesco Pesole, FX strategist at ING, told CNBC.But the pound could still be on course for a difficult time, Pesole suggested.
Sverige Senaste nytt, Sverige Rubriker
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