London close: Stocks end higher ahead of Scottish Independence vote

It was a strong finish for UK markets on Thursday as investors await the outcome of the Scottish referendum, the result of which is due to be announced around 7am on Friday morning.

The top tier index closed 38.39 points higher at 6,819.29, with Scottish stocks leading the way.

"As the Scottish line up at polling stations across the country, stock markets are broadly higher on optimism spread by perception of ongoing accommodation from the US Federal Reserve and the Bank of England to compliment more aggressive easy monetary policy from both the Bank of China and the European Central Bank," said CMC market analyst Jasper Lawler.

"Most FTSE 100 companies don’t do a lot of business in Scotland but the uncertainty of a 'Yes' vote could push stock prices lower and the stock price declines of those businesses who have strong ties could easily do substantial damage to the market as a whole."

The Scottish vote on separating from the UK began on Thursday morning with the result still too close to call given the recent momentum behind the pro-independence campaign in recent weeks. Polls opened at 07:00 and will close at 22:00.

Liberum published a note on Thursday telling clients that in the event of Scotland voting in favour of independence then the worst affected sectors would be Oil, Life Insurance and Banking, basing their views on what happened following the mini-scare of 8 September after a weekend poll showed the yes camp in the lead in the latest Scottish polls.

UK retail sales rise in August on strong housing market

In other news, the volume of UK retail sales grew by 0.4% month-on-month in August, and by 3.9% when compared to the year ago period, according to the Office for National Statistics (ONS).

The consensus estimated a 4% growth year-on-year but the monthly growth met expectations.

In July, growth was flat, while in June it only increased by 0.1%. The ONS said the retail sales growth was driven by a 12.7% increase in household goods sales such as furniture and electrical appliances.

TUI rises after broker upgrade

TUI Travel was a strong performer thanks to an upgrade from Morgan Stanley to 'overweight' following its merger with TUI AG.

Scotland-based businesses such as RBS, Lloyds, Standard Life and Aberdeen Asset Management were among the best performers as investors readied themselves for the outcome of the referendum. RBS and Lloyds both said last week that they would redomicile in London if Scotland voted for independence.

Budget airline Easyjet was in demand after deciding to increase its payout ratio and said it will return 40% of its profits to shareholders from next year. The company also reached a discounted deal with Airbus to exercise existing purchase rights over 27 current-generation A320 aircraft.

Precious metals miners, including Randgold, Polymetal and Fresnillo, were in the red as they tracked metal prices lower.

Shares in Booker Group performed strongly on Thursday after the group reported a 3.1% year-on-year rise in like-for-like sales. The result was welcome by Peel Hunt, which said it continues to see "significant upside" at the cash and cash firm after a decent second-quarter update. The broker kept a 'buy' recommendation and 180p target price, hailing an "encouraging" statement.

Legoland and Sea Life centres owner Merlin Entertainments was another strong riser after the group said profit growth remained consistent with internal expectations and anticipates full year margins at the earnings before interest, tax, depreciation and amortisation level to be "similar to last year's levels". Like-for-like revenue growth stood at 6.7% after the first 36 weeks of the year, slowing from the 8.1% growth seen in the first six months.

Premier Farnell cheered with its first-half results, which it said reflected the gradual improvement in the market backdrop and lower finance costs. Adjusted first-half sales climbed 3.3% on an underling basis to £479.3m, helping to lift adjusted pre-tax profit 2.4% to £38.8m.

Events and PR group UBM responded to recent market rumours that it was plotting a $900m acquisition of US rival Advanstar from its private equity and hedge fund owners.

Market Movers
techMARK 2,850.44 +0.77%
FTSE 100 6,819.29 +0.57%
FTSE 250 15,722.81 +0.94%

FTSE 100 - Risers
TUI Travel (TT.) 384.00p +4.66%
Barratt Developments (BDEV) 403.80p +3.01%
Travis Perkins (TPK) 1,697.00p +2.54%
Smiths Group (SMIN) 1,300.00p +2.52%
Wolseley (WOS) 3,362.00p +2.44%
Rexam (REX) 510.00p +2.27%
Whitbread (WTB) 4,264.00p +2.13%
Persimmon (PSN) 1,380.00p +2.07%
GKN (GKN) 346.90p +1.97%
3i Group (III) 386.20p +1.93%

FTSE 100 - Fallers
Randgold Resources Ltd. (RRS) 4,430.00p -2.55%
Tullow Oil (TLW) 665.50p -2.35%
Fresnillo (FRES) 782.50p -1.94%
SABMiller (SAB) 3,537.00p -1.12%
Sainsbury (J) (SBRY) 280.90p -0.81%
Burberry Group (BRBY) 1,521.00p -0.72%
Admiral Group (ADM) 1,211.00p -0.66%
United Utilities Group (UU.) 839.00p -0.59%
Anglo American (AAL) 1,489.50p -0.50%
G4S (GFS) 256.70p -0.43%

FTSE 250 - Risers
Booker Group (BOK) 125.40p +7.82%
Evraz (EVR) 140.40p +7.26%
Diploma (DPLM) 703.00p +4.61%
Synthomer (SYNT) 228.00p +4.59%
Ophir Energy (OPHR) 250.40p +4.16%
Spirent Communications (SPT) 107.60p +4.06%
Tate & Lyle (TATE) 732.00p +3.68%
Fidessa Group (FDSA) 2,323.00p +3.66%
IP Group (IPO) 221.50p +3.60%
Poundland Group (PLND) 328.70p +3.27%

FTSE 250 - Fallers
Polymetal International (POLY) 481.30p -4.03%
Oxford Instruments (OXIG) 1,046.00p -3.68%
Lonmin (LMI) 203.30p -3.42%
Xaar (XAR) 376.90p -3.36%
Serco Group (SRP) 285.00p -2.73%
Vedanta Resources (VED) 1,015.00p -2.31%
Centamin (DI) (CEY) 58.90p -2.00%
AL Noor Hospitals Group (ANH) 1,015.00p -1.46%
Smith (DS) (SMDS) 283.00p -1.36%
Supergroup (SGP) 1,171.00p -1.35%