NZ stocks: Shares go sideways after election

The New Zealand sharemarket was trading sideways this morning, after voters failed to make a clear cut decision in Saturday's election.

The incumbent Labour Party will have the first chance to form a government after winning 50 seats against the National Party's 49.

With over 200,000 special votes to count as well as coalition talks to negotiate, the final word on who will form the new Government is not expected for up to two weeks.

Reaction to the stalemate result was muted, with the benchmark NZSX-50 index easing 3.27 points to 3431.61 by 10.10am, while the NZSX All-capital index was 1.50 points down at 1060.59.

Stock exchange chief executive Mark Weldon said the lack of a clear mandate for either party could be good for business, as it would signal fiscal stability, with neither party able to put through dramatic tax or spending policies.

"You are not going to see a whole lot of fiscal stimulus on either side of the ledger, whether it's tax or spending, and in some ways that's not a bad outcome," Mr Weldon said.

"In terms of profitability and operating environment, not a lot will change."