MONDAY MARKET CLOSE: Poll puts pressure on market

Sterling and stocks with Scottish links fell sharply in the wake of a weekend opinion poll pointing to a surge in support for independence.

The increased chances of a Yes vote on 18 September have fuelled the City’s jitters over the impact that a break-up will have for banks and other companies with major operations in Scotland, as well as for economic stability.

The FTSE 100 Index slumped by more than 1 per cent at one stage before recovering to close 20.3 points down at 6834.8, with other European markets little changed.

Sterling fell by around 1.3 per cent against the US dollar to a ten-month low of $1.61, leaving it around 6 per cent lower than its peak of $1.72 earlier this summer. The pound was also weaker against the euro, at €1.25.

The referendum uncertainty meant companies with headquarters or substantial operations in Scotland dominated the FTSE 100 fallers board. Standard Life was the biggest Scottish top-flight faller, down 10.1p or 2.4 per cent, at 406.4p.

Outside the top tier, shares in De La Rue were 4 per cent or 31p higher to 774p after the Bank of England said it had chosen the firm as its preferred bidder for a bank note contract due to start in October.

The biggest risers in the blue-chip index were Arm Holdings up 24.5p at 981p, drug firm Shire up 110p at 5,135p, Tesco up 4.4p at 232.9p and packaging group Mondi up 18p at 1,063p. The biggest fallers included wealth manager and broker Hargreaves Lansdown, down 28p at 1,033p.

Among smaller companies, Aim-quoted geosciences group Getech saw shares rise 10.5p, or 18.4 per cent to close at 67.5p, after it landed a new contract with the Angolan National Oil Company.