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Edition: U.S. Article Comments (0) Slideshow Video Save Email Print Reprints Most Popular Most Shared BP seeks solution after spill plan glitch | Video 2:17am EDT Ash cloud closes 19 Spanish airports, could spread | Video 08 May 2010 Germans vote in state poll, big test for Merkel 08 May 2010 Study finds what makes calorie-burning "brown fat" 06 May 2010 Lose weight fast to get lasting results: study 07 May 2010 WRAPUP 13-Conservatives need partners after inconclusive UK vote 07 May 2010 Anger as NATO prepares to join Red Square parade 08 May 2010 Obama makes rare comment about dollar on Russian TV 08 May 2010 Oil at $65 a barrel may sound alarm bells for OPEC 08 May 2010 U.S. warns Pakistan after NY bomb attempt: report 08 May 2010 U.S. reverses stance on treaty to regulate arms trade 14 Oct 2009 Concert promoters embrace new media for fan services 07 May 2010 Economy impact to rise sharply if ash lingers 19 Apr 2010 Taliban to launch major offensive in Afghanistan 08 May 2010 Pope accepts resignation of German bishop in sex probe 08 May 2010 Obama makes rare comment about dollar on Russian TV 08 May 2010 UK opposition parties seek deal to form government Avril Ormsby LONDON Sat May 8, 2010 8:49pm EDT Factboxes Factbox: Rules for inconclusive British election Sat, May 8 2010 Factbox: British newspapers comment on hung parliament Sat, May 8 2010 Related News UK could face another election within year Sat, May 8 2010 Labour MP calls for UK's Brown to stand down Sat, May 8 2010 UK political instability to knock sterling lower Sat, May 8 2010 British parliament has big intake of rookies Sat, May 8 2010 Scenarios: Possible forms of government after UK election Sat, May 8 2010 Related Video UK polls add to market jitters Thu, May 6 2010 Indecision and chaos dog UK poll Markets watch UK polls UK LibDem leader 'disappointed' < 1 / 21 > View Full Size LONDON (Reuters) - Britain's main opposition parties will seek to overcome differences on electoral reform and other issues on Sunday to break a political deadlock after last week's inconclusive election before financial markets lose patience. World David Cameron's Conservatives won the most seats in Thursday's parliamentary election but fell short of a majority to form a government and are seeking the support of Nick Clegg's center-left Liberal Democrats. It is the first election since 1974 where no one party has won an overall majority, leading to horse trading that is unfamiliar in British politics. Teams from the Conservatives and the Liberal Democrats are due to meet at 11 a.m. (6 a.m. EDT) in an attempt to secure a deal that would end 13 years of Labour rule. The greatest stumbling block may well be electoral reform, a long-cherished ambition of the Liberal Democrats who would win far more seats if Britain switched from its winner-takes-all system to proportional representation. The Conservatives are firmly opposed to such a change. A YouGov poll in the Sunday Times showed 62 percent of those surveyed favored a more proportional system of voting. The parties must overcome other key differences on economic policy, defense, immigration and Britain's stance toward Europe, but they could find common ground on issues such as lower taxes for the poor and the environment. Both say they will not be rushed, but are acutely aware of the financial markets' need for decisive action on the country's record budget deficit, running at more than 11 percent of output. It is unlikely a deal could be reached by Monday, a Conservative spokesman said, noting that the party's new members of parliament, who will be briefed on the negotiations, would not meet until Monday evening. Prime Minister Gordon Brown, who continues to rule but effectively was sidelined after he said on Friday that the Conservatives and Liberal Democrats should be given the time they needed to hold talks, nevertheless had phone conversations with Clegg, the Liberal Democrats said on Saturday. "At the request of the Prime Minister, Nick Clegg took a call from Gordon Brown this evening. The conversation was amicable," they said in statement. Clegg, who has to win his party's support before any deal can go ahead with either party, was locked in discussions with party officials throughout most of Saturday, which his chief of staff said had been "positive and productive." The leader also held a 70-minute meeting with Cameron late on Saturday, which both parties said was "amicable and constructive." Another key hurdle to a deal is agreement on the pace of lowering the budget deficit. The Conservatives have pledged to start cutting it immediately but the Liberal Democrats say this could harm Britain's recovery from a deep recession in 2008-2009. If the Liberal Democrat/Conservative talks fail, a deal between Clegg's party and Labour is possible, but more complicated as the two parties combined would still not have enough MPs to command a majority in the 650-seat House of Commons. (Editing by Michael Roddy) World Add a Comment *We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language or appear to be spam and review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. 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