Tuesday, 9 September 2014

Share activity in Scottish institutions is livening-up

Share activity in some of the Scottish based institutions, such as Royal Bank of Scotland and Standard Life is becoming more lively following recent YouGov polls that highlighted the chance of a ‘Yes’ vote for Scottish independence is growing by the day. For some time the ‘No’ vote was supposedly leading by at least 15-20 points. This has now collapsed to low single digits and for the first time, in the last couple of days, marginally swung in favour of the ‘Yes’ campaign, suggesting the real possibility of a very close finish. The referendum will take place on Thursday 18th September.

Investors were looking for ‘signs of life’ for Tesco after the recent profit warning and dividend cut reduced the valuation of the food retailer but the share price continues to languish at levels not seen for many years.

In the quarterly shuffle it appears that mid-cappers Direct Line Insurance Group and Dixons Carphone are likely to be promoted to the FTSE-100. This news is normally a positive and should help to boost the valuations.

Barclays is launching a new way to access bank accounts for its business customers, which identifies individuals through the unique pattern of veins in their fingers. The technology is quite distinct from fingerprint recognition and is yet another way of combating fraud as users become increasingly fed up with multiple passwords and PINs.

It has been a week of big news on the economic front with the main story being the surprise rate cut by the ECB and their commitment to buying bonds to boost the European economy. What was meaningful was that the ECB vote over policy change was not unanimous, implying that the German Bundesbank had been outvoted again. With disparate economic performance in the Eurozone the importance of struggling nations standing up to the Bundesbank is paramount and indications that it will do so are welcome.

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