FTSE 100 shrugs off surprise general election, Nvidia beats estimates

The FTSE 100 took the surprise announcement of the general election in its stride on Thursday and the index was very marginally higher in mid-afternoon trade.

The prospect of a Labour government in just six week’s time has done little to upset UK equity markets. Far from sending a wave of panic through stocks, many UK-centric shares were actually trading materially higher as investors assessed the implications of Keir Starmer in Number 10 Downing Street.

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Analysts cautioned that markets could experience gyrations during the election campaign but will ultimately usher in Starmer and his new government with little volatility.

“Equity markets could become more volatile during the election campaign, as party policies come under greater scrutiny and as opinion polls change. However, assuming opinion polls do not change materially in the run up to the election, we would expect the equity market reaction to a potential Labour win, which is currently widely expected, to be fairly muted. Markets do not like surprises and this would not be a surprise,” said Edward Stanford, Head of European Equity Strategy, HSBC.

“The bigger risk to markets in our view would be a closer election result that creates the impression of greater instability in the post-election period.”

Keir Starmer has been accused of being dull, which may actually turn out to be a good thing for UK stocks.

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Housebuilding stocks were clearly favoured as a result of the election news, with Persimmon, Taylor Wimpey, and Barratts among the top risers.

The biggest FTSE 100 casualty on Thursday was National Grid – not because of the election – but because it launched a rights issue to bolster a £60bn investment spending plan.

National Grid shares were down 9% after announcing a £7bn rights issue alongside falling profits for the last year. United Utilities, Centrica, and Severn Trent fell in sympathy.


As UK stocks traded sideways, there was a little more life in the US and Nvidia, who beat earnings estimates and confirmed the AI boom was still very much intact.

“Better news was to be found from NVIDIA, whose shares popped 6% after beating expectations. The group’s expected to ring the bell on a new all-time high, exceeding $1000 per share, when the US market opens,” said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.

“The chip specialist reported a 262% increase in revenue, as AI chip demand reached record levels. While questions about the longevity of NVIDIA’s technical supremacy are being whispered in some corners of the market, the group has raised the bar again with the Blackwell Platform, the world’s most powerful chip.

“Being at the forefront of the specialised end of this market is a highly enviable place to be, the big question, as ever, remains whether the current market valuation is a fair reflection of the remaining opportunity, or approaching dangerous territory.”

Notwithstanding concerns about a frothy valuation, Nvidia’s results will go a long way to keeping the equity bulls fired up with enthusiasm around AI demand in the coming months.

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