A strange thing happened yesterday. In the midst of a general election campaign, the opposition Labour Party indirectly threatened to nationalise at least four major UK companies. Under normal circumstances, the share prices of the companies in question would have been rattled to their foundations as City investors took flight.
Yet these are not normal circumstances. The stocks barely moved at all. And this probably tells you everything you didn't know already about the result of the election on 8 June. Labour's chances of winning are even lower than you thought they were, and this has implications for how you trade shares during the next few weeks of political campaigning.
According to yesterday's leaked manifesto, Labour leader Jeremy Corbyn would bring Royal Mail back under state control. This comes less than four years after its massively oversubscribed flotation in October 2013. That would normally be seen as share-price-shattering news. So what happened? Royal Mail rose 0.62%. Investors simply aren't worried.
The Labour manifesto also pledged to take energy back into public ownership, with central government control of the natural monopolies of the transmission and distribution grids. So farewell then National Grid, privatised in 1995 and now with a market cap of £38bn. Its share price did fall yesterday but only by 0.67%, which hardly suggests an enterprise in mortal peril.
Another pledge is that rail networks will be nationalised as each private franchise expires, with publicly owned bus companies set up. That could mean a bump in the road for National Express which recently quit UK rail through its sale of c2c to Trenitalia but still runs extensive coach operations. As does FirstGroup, one of the largest bus operators in the UK, with a fifth of the market outside London. So did the share prices go sharply into reverse? Hardly. National Express dipped just 0.24% while FirstGroup rose 0.92%.
It is all a long way from former Labour leader Ed Miliband's short-lived glory days. His threatened energy price freeze in 2015 marked the start of a tailspin for British Gas owner Centrica from which it still hasn't pulled out. Yesterday, we discovered that his successor wants to bring parts of the energy industry into public ownership and introduce a local, socially owned energy firm in every area. He also wants an "immediate emergency price cap" to make sure dual fuel bills stay below £1,000 a year.
Centrica did slump yesterday, its share price falling 5.41%. Was that down to Corbyn? Apparently not. The culprit was JPMorgan Cazenove, which downgraded the stock from overweight to underweight, and warned of a looming price war. Investors are also fretting about Prime Minister Theresa May's proposed price cap. They aren't concerned about Corbyn.
Back to the future
Labour's manifesto has been attacked for returning us to the 1970s but some of the measures are actually popular, notably bringing the railways back under public sector ownership. However, the City, which would normally oppose these plans, hasn't even bothered to take a view.
Investors just assume that none of this will happen, because it considers Jeremy Corbyn and his divided party to be wholly unelectable. Even the share price of shale frackers, also targeted, were unmoved. Investors can afford to dismiss the prospects of the Labour victory, and this means they shouldn't bother positioning themselves for a Conservative win either. Theresa May's landslide is already completely priced-in.
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Harvey Jones has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.