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EU elections – rout for Socialists, advance for Euro-Sceptics
The 4 Jun elections for the EU parliament provided three key results, which applied to all EU countries with very few exceptions:
(1) a record low turnout;
(2) a rout for the Socialists;
(3) a strong showing of Euro-sceptics.
For Germany and the UK the EU elections will have been closely scrutinised, since they were perceived as a dry run for national elections in the next four months or twelve months respectively.
The main surprise was the drubbing the German Social Democrats received – they fell to a record-low of 20%, undermining their attempt to challenge chancellor Merkel’s CDU/CSU as the leading party in government.
The German election result increases the chances for a centre-right government after the national elections on 27 Sep.
Centre right majority in new EU parliament is likely to foster market oriented solutions in fields subject to EU legislation.
Asset conclusions: the loss of Socialists is likely to shift decision making towards more market-oriented solutions; positive market impact only to materialise, if EU constitution is ratified.