Labour's second landslide election victory may have caused problems for sterling in the foreign exchange markets but equity investors received the result with equanimity.

The result had been widely discounted in the stock market and the FTSE 100 index opened the day with a modest gain, reaching a session high of 5,981.8, up 33.5, just before 10am.

It was only in the afternoon, when Juniper Networks became the latest US technology company to issue a profit warning, that Footsie came under any selling pressure. Both the Dow Jones Industrial Average and the Nasdaq Composite were lower by the London close.

But even at its worst, Footsie was only 13.5 lower at 5,934.8 and the blue chip benchmark managed to end the session with a modest 2.3 gain at 5,950.6.

With sterling drifting to another 15-year low against the US dollar, there were one or two signs that investors were looking for beneficiaries from a weakened pound. Steel group Corus, hit earlier in the week by fears of US import restrictions, rebounded strongly. But analysts were turning their attention to how an early push for euro membership might affect the equity markets.

"Sterling's depreciation could be the catalyst that pushes the FTSE 100 decisively through the 6,000 level," says Mike Lenhoff, chief portfolio strategist at Gerrard. "The immediate beneficiaries of a weaker currency are the overseas earners which gain from translation effects on earnings." Three dollar-linked sectors, oils, pharmaceuticals and banks, make up 48 per cent of the FTSE 100.

"UK equities made big gains in 1997 on EMU-entry speculation," said Ian Stewart, UK economist at Merrill Lynch. "Any equity market impact this time is likely to be smaller than it was in 1997 because UK and euro rates have moved far closer.

"Still, a weaker pound is export positive. With no clear answers on the timing of a referendum or on exchange rates likely for some time, sterling is likely to remain vulnerable to heightened EMU speculation."

Kevin Gardiner of Credit Suisse First Boston said: "Our overall UK position is unaltered by the unsurprising election result. We are overweight, with an end-year FTSE 100 target of 6,700."

Aside from the post-election calculations, the markets also saw weakness in the banking sector and a knock-on effect from the Juniper warning on technology stocks such as Spirent.

Turnover was 2.12 billion shares by the 6pm count, with activity in Vodafone once again topping 550 million.