19th Sep 2014 06:39
LONDON (Alliance News) - UK stocks are set to open considerably higher Friday after Scots voted 'No' to independence.
Futures indicate that the FTSE 100 will open 60 points higher at 6,879.3. The index closed at 6,819.29 on Thursday.
Sterling also shot up on the Scottish 'No' vote, moving above the USD1.65 mark.
Investors have breath a sigh of relief after the Scottish electorate have voted to continue with more than 300 years of union with the rest of the UK, but Scottish First Minister Alex Salmond immediately said he expected the UK's main political parties to honour their promise to devolve more powers to the Scottish parliament. With 31 of the 32 council areas declared, the 'No' campaign has an unassailable lead, with a 55% share of the vote, compared with 45% for the 'Yes' vote.
The 'No' vote should ensure some stability for the near-to-mid-term future for the UK, and investors are expected to take the opportunity to buy into British stocks.
However, the relative closeness of the vote indicates that the future will be different as David Cameron has promised more power to Scotland from London.
"The UK will be different, but it will remain one country for the time being. By promising extra powers to Scotland within the UK, London has helped to keep Scotland in. But Prime Minister David Cameron may have to pay a price for the late promise of more home rule for Scotland," says Berenberg's chief UK economist Rob Wood.
Away from Scotland, Japan's all industry activity declined at a slower rate in July, defying expectations of remaining flat, figures from the the Ministry of Economy, Trade and Industry showed. The all industry activity index fell 0.2% month-over-month in July following the 0.3% drop in June. However, the country's leading economic index was revised down to 105.4 in July, from 106.5. In June, the index was at 104.7.
Trading in Asia has been strong Friday, with the Nikkei closing up 1.6%, while the Hang Seng trades up 0.9% and the Shanghai Composite is up 0.6%.
US trading closed higher, with the DJIA up 0.6%, the S&P 500 up 0.5% and the Nasdaq Composite up 0.4%.
In stock news, Evraz has said that it is considering an IPO for its North American arm in response to "certain market rumours". Goldman Sachs has since raised the stock to 133 pence from 87p, maintaining its Neutral rating. Evraz closed at 140.4p on Thursday.
FTSE 250-listed online takeaway food delivery service Just Eat has announced the merger of its Brazillian business RestauranteWeb with iFood.com Agencia de Restaurantes Online. The merger will create IF-JE Participações Ltda which will be a joint venture between JUST EAT and iFood's existing shareholders.
The rest of Friday's economic calendar is quiet, with European current account data to be released at 0900 BST and US Conference Board leading indicator to be released at 1500 BST.
By Neil Thakrar; [email protected]
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
Just EatEvraz