With 30% of councils still to..........>

GILT SUMMARY: With 30% of councils still to declare and the Conservatives

already down 847 seats, the local elections have indeed turned into a bit of a

bloodbath for the government. Party insiders have previously said that 600

losses would be a 'good result', while losing 800-1000 seats would be difficult

to downplay. 

- Meanwhile the Liberal Democrats have picked up 495 seats and the Green Party

124 seats. 

- With  the Tories and Labour suffering in the local elections, and both sides

conceding that support has haemorrhaged on the back of their handling of Brexit,

this could nudge up the probability of a cross-party deal being agreed.

- Gilt yields edged lower this afternoon and have returned towards yesterday's

closing levels. Current yield levels: 2-year 0.768%, 5-year 0.921%, 10-year

1.190%, 30-year 1.707%.

. The Jun-19 gilt future trades at 127.21, 23 ticks off the high.

- Short sterling futures are broadly 0.5-1.5 ticks higher in whites/reds and

flat/0.5 ticks lower in greens/blues.