Financials lead UK stocks higher after Scottish "No"
* FTSE 100 up 0.6 pct; volatility index drops
* Banks, asset managers up 1.2-3.4 pct on FTSE 100
* Scotland-based stocks up 1.0-3.4 pct as UK stays united
By Tricia Wright
LONDON, Sept 19 (Reuters) - UK banks and asset managers led
London equity indexes higher on Friday after Scottish voters
rejected independence, prompting a relief rally from investors
who had been concerned the United Kingdom might break up.
Lenders with strong exposure to Scotland, including Royal
Bank of Scotland and Lloyds Banking Group, were
up 2 percent to 3.4 percent. Asset managers Schroders (LSE: SDR.L - news) ,
St. James' Place and Aberdeen Asset Management (Other OTC: ABDNF - news)
rose between 1.2 percent and 3.1 percent.
A vote for independence would have raised immediate
questions over what currency Scotland would use and its position
within the European Union.
Trading volume in RBS (LSE: RBS.L - news) was particularly strong, already at
its normal 90-day daily average after an hour's trade,
contrasting with the broader FTSE 100 on around 40 percent.
The blue-chip FTSE 100 index was up 40.00 points, or
0.6 percent, at 6,859.29 points by 0802 GMT, trading back up at
levels last seen at the start of the month.
Scotland's vote against independence ended a skittish two
weeks for the UK benchmark index, which dropped sharply when one
poll unexpectedly showed a lead for the pro-independence side.
Engineering groups Weir and Babcock were up
between 1.6 percent and 2 percent.
Shares (Frankfurt: DI6.F - news) of firms with significant exposure to Britain's North
Sea oil industry also rose, with North Sea rig operators
Petrofac and Enquest (LSE: ENQ.L - news) up 1.4 percent and 1.5
percent respectively.
A basket of top Scotland-based stocks on the broader FTSE
350 index also traded higher, with its dozen or so components up
between 1 and 3.4 percent.
"The markets were pricing in a no vote... but now that we've
got confirmation of that it's going to propel stocks on from
here," Mike McCudden, head of derivatives at Interactive
Investor (Other OTC: IVSBF - news) , said.
A 4.3 percentage point drop in the FTSE 100 Volatility Index
, which measures the price of options on UK blue-chip
stocks, suggested the relief over the vote could set the market
up for a smoother ride.
Trading could be choppy in morning trade, however, due to
"triple-witching" - when the contracts for stock index futures,
stock index options, and stock options expire on the same day.
(Editing by Lionel Laurent and John Stonestreet)