UK Election Watch Summary At HSBC

In their Global Research report published Wednesday, HSBC analysts provide a guide to polling day and the immediate aftermath for the UK election.

UK election is scheduled for May 7 and is expected to be the "most uncertain election for decades." Polls suggest a hung parliament and there could be "a long period of negotiation before a government is formed," the analysts said.

Throughout the campaign, the polls have moved in a relatively narrow range and the trend remains the same in the final weekend. "Applying the national swing uniformly across constituencies would point to Labour narrowly being the largest party…Even if the Conservatives are the largest party, they may struggle to forge an alliance," the analysts wrote. In case there is a narrow majority, the party would not be able to survive the full five-year term.

Exit polls would give an indication on Thursday, at around 10pm and the first declarations should be out before midnight. "By 4am, more than 500 of the 650 seats should be declared, giving a good indication of the final result," the report mentioned.

The analysts provided a table of "ten constituencies to watch" which would provide pointers for the overall outcome:

1. Berwickshire, Roxburgh and Selkirk
2. Brentford and Isleworth
3. Devon North
4. Paisley and Renfrewshire South
5. Sheffield Hallam
6. Southampton Itchen
7. Thanet South
8. Thurrock
9. Warwick and Leamington
10. Wirral West

"If, as the polls suggest, there is a hung parliament then we won’t necessarily know who will form the next government even after the votes are all counted. Rather there will be a period of negotiation," the analysts commented. David Cameron would remain the Prime Minister while the negotiations are on with other parties. There is no certainty around how long the negotiations would last.

The new parliament is scheduled to meet on May 18, and on May 27 there would be the Queen’s speech debate, which is said to be the "first big test of any government."

"If neither David Cameron nor Ed Miliband felt they could command a majority in the Commons, then Mr Cameron would continue as PM but would presumably fail to pass the Queen’s speech. This would eventually trigger a second election…If there were to be a second election this year, we suspect it would not be immediate but that there would be a period of a few months during which party leaders and policies could change," the report added.