Breaking News: Angela Merkel Coalition Loses Majority In German State Vote According To Exit Polls

Political doctrine - meet Newton's third law. Headline from Reuters. This will serve as a huge setback to a consolidated European rescue of not only Greece but all PIIGS (and then all of Europe itself). Polls are now closed and the first preliminary read is as follows: 34.5 CDU, SPD 34.5, 12.5 Green, FDP 6.5 Left 5.5. And the biggest losers from this, aside from the line of willing bailout recipients may be German public utility: as Bloomberg notes: "Chancellor Angela Merkel’s parliamentary spokesman for economy and energy, Joachim Pfeiffer, said that the German government may not have to get approval from the federal parliament’s upper chamber to extend the operating life of nuclear power plants." EON, RWE and other utilities may not appricate their 10 year ultimatum in tomorrow's DAX.

From Reuters:

Chancellor Angela Merkel's centre-right coalition parties failed to retain their majority in a state vote on Sunday, an exit poll showed, robbing her government of a majority in the upper house of parliament.

An exit poll by ARD television put Merkel's Christian Democrats (CDU) on 34.5 percent and their Free Democrat (FDP) allies on 6.5 percent, short of a majority and leaving the make up of North Rhine-Westphalia's next government unclear.

The CDU and FDP have ruled in the state -- Germany's most populous -- since 2005, when they won 44.8 percent and 6.2 percent of the vote respectively.

Their loss of a majority in the state -- and as a consequence in the federal upper house -- means Merkel will have to rely on opposition parties for support for her policy programme, which includes tax cuts, health reform and extending the lives of some nuclear power plants.