PA 26 Dec 96 4:56 GMT S7257 Copyright 1996 PA. Copying, storing, redistribution, retransmission, publication, transfer or commercial exploitation of this information is expressly forbidden. By Philip Thornton, Business Editor, PA News STOCK MARKET 'PERFORMS NO BETTER UNDER TORIES' There is no evidence to show the stock market performs better in the longer term under a Conservative Government compared with a Labour administration, according to new research. A study of the London stock market since the end of World War II by Leeds University business school found shares had performed fairly consistently whatever the political shade of the party in Government. Professor Kevin Keasey, director of the Centre for Financial Services, said an initial surge following the election of a Tory Government was not followed by its longer term performance. "This sheds new light on the conventional wisdom that Labour are not to be trusted to run the economy to the benefit of businesses and shareholders," he said. "Conservative governments are, however, associated with significantly lower levels of average inflation and higher average levels of real interest rates." He said this reputation for tight fiscal management helped explain the immediate response after an election victory. "But there is no statistically significant evidence to suggest the stock market has performed better in nominal or real terms under a Tory Government." Professor Keasey showed short-term share price movements responded to opinion poll findings in the run-up to General Elections and showed a clear preference for a Conservative win. He also found there was no evidence to show different Governments had been able to manipulate the economy or the market for electioneering purposes.
