Tory wobble continues on betting markets as May, 'dementia tax' shambles hit landslide hopes

The ground between the ruling Conservative Party and Labour continued to narrow on Tuesday as Betfair cut the opposition's odds to 11/1 from 13/1 after Monday night's questioning of Prime Minister Theresa May and her rival, Jeremy Corbyn.

Meanwhile, spread betting firm IG said May's performance in the “debate” and the party's bumbling and humbling u-turn over social care had seen clients become “more bullish” on Labour's chances in the June 8 election.

Betfair's Katie Baylis said there was “no doubt” Labour was closing the gap in the polls, “which is a sentiment that’s also being reflected in the odds”.

Baylis said the indication was that Corbyn gave Labour “a slight advantage” after last night’s questioning on television.

“In the last week alone more than 65% of bets have been on Labour, however almost 95% of money is on the Tories, who are still heavy odds-on favourites at 1/14,” she said.

“On the Overall Majority market a Conservative majority is at 2/13, with no overall majority at 15/2 and a Labour majority at 33/1.”

IG said Labour had been languishing in the parliamentary seats market at around 150 but had now moved up to 184, which would still be a loss of 45 constituencies. The Tories are on 378, a predicted gain of 48, The Scottish National Party was eight seats lower with 46 and the Liberal Democrats on 14 for a gain of five.

May was forced into a humiliating climbdown on a controversial manifesto promise known as the 'dementia tax' following sharp criticism of the party’s social care policy. She looked to be cruising towards a landslide victory in the weeks following the calling of the snap election, but a combination of Labour momentum and a backlash over the Conservative manifesto pledges have diminished her party's lead.

Analysts at Detsche Bank said political risks had increased as the Tories' ratings eroded to 10 points from 18 a month ago, based on a 10 poll moving average.

"The last two weeks have been traumatic for the Conservative campaign. Attention has veered off Brexit after
deeply unpopular education and social care plans were announced in the Conservative manifesto, while the Labour Party’s own policy proposals appear to have been effective at attracting Liberal Democrat voters," DB said in a report to clients.

"As things stand, our base case of a market-friendly 50/60 seat Conservative majority remains intact - just."