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London • Scotland's decision to reject independence from the United Kingdom shored up British stocks on Friday but worries over future constitutional changes kept a lid on the relief rally.
With all 32 Scottish councils having declared, the No campaign won 55.3 percent of the votes cast in Thursday's referendum against 44.7 percent who backed independence. The 10-point or so victory margin was wider than expected — most opinion polls were predicting a narrower 4-point victory for proponents of the union with England, Wales and Northern Ireland.
The FTSE 100 index of leading British shares was up 0.7 percent in late morning trading as investors breathed a sigh of relief that a host of thorny economic issues were not triggered by a Yes vote.
As well as worries over what currency an independent Scotland would use, investors had concerns over how the U.K.'s $2.1 trillion debt would be split. There were even fears that a Yes vote may have triggered a bank run. The uncertainty was so great that Bank of England Governor Mark Carney flew back early from a summit in Australia.
"It might not have been financial meltdown territory, but the markets almost certainly would have been in turmoil this morning if the Scots had voted yes," said Dennis de Jong, managing director at UFX.com.
Those companies with Scottish connections outperformed the general market. Among them, Royal Bank of Scotland PLC was up 3 percent, while Lloyds Banking Group PLC rose 1 percent. Oil giant BP PLC, which has sizeable operations off the shores of Scotland, was up 1.1 percent, too.
Royal Bank of Scotland, which is majority-owned by the U.K. government since receiving a bailout during the financial crisis in 2008, said it was abandoning a contingency plan that included moving its head office down south to England.
"That contingency plan is no longer required," the bank said in a statement. "Following the result it is business as usual for all our customers across the U.K. and RBS."
In the currency markets, the pound was faring less well than stocks, partly because it had already rallied strongly this week on expectations of a No vote.
Having earlier risen to a two-year high of 1.2817 euros, the pound settled around the 1.2734 euro mark, largely flat on the day. Against the dollar, the pound was down 0.3 percent at $1.6390.
Uncertainty over the pound was likely a key element in the No campaign's victory. Last week, the pound took a battering after opinion polls indicated the vote would be closer than anticipated.
A key concern had been what currency an independent Scotland would use. The Yes campaign had hoped it would still use the pound through a currency union with what's left of the U.K. but the main British political parties insisted that wasn't going to happen.
"There is nothing like uncertainty about the money in your pocket to sharpen the minds of voters," said Derek Halpenny, head of global markets research at the Bank of Tokyo-Mitsubishi UFJ.
Now that the independence issue has been resolved, the focus in markets is swiftly moving on. Late on in the campaign, Scotland, which has its own Parliament responsible for a wide array of policies such as health and education, was promised further devolved powers from London.
Cameron's statement to create a "balanced settlement, fair to people in Scotland and importantly to everyone in England, Wales and Northern Ireland as well" suggests more reforms are likely to be proposed as part of a broad-based constitutional rejig in the U.K.
"The Scottish referendum may be over, but political uncertainty is here to stay in the U.K.," said Kathleen Brooks, research director at Forex.com. "Markets tend to be fearful of political uncertainty, especially when it could change the political landscape in a major global power like the U.K."