European stocks ended flat yesterday, as worries over Scotland’s vote on independence and growing expectations of a more hawkish stance from the US Federal Reserve kept investors on edge.
The market has become concerned that supporters of Scottish independence have been gaining in opinion polls, a week before a referendum on the issue.
They were also worried by rising US bond yields, anticipating a more hawkish tone at a Fed policy meeting next week.
Scepticism that Scotland will vote for independence has been tested in recent opinion polls
The FTSEurofirst 300 index of top European shares ended 0.02 per cent higher at 1,385.77 points. The benchmark index has erased all the gains spurred by the European Central Bank’s moves last week to support the region’s economy.
Around Europe, Germany’s DAX index fell 0.1 per cent and both France’s CAC 40 and Italy’s MIB lost 0.04 per cent. Spain’s IBEX slipped 0.1 per cent, weighed by a drop in the shares of Santander.
The Spanish bank lost 0.7 per cent as the death of its chairman prompted worries over succession. Emilio Botin, who transformed Santander from a small domestic lender into the eurozone’s biggest bank, died of a heart attack on Tuesday night.
“He was perceived as the man who built Santander into a global bank,” said Javier Bernat Valenzuela, an analyst at Beka Finance in Madrid. “He has been the person who has looked after the bank for the past 30 years. But you have to realise there will not be significant changes because the bank is pretty well structured.”
Shortly after Europe’s markets closed, Santander’s board of directors said they appointed Ana Botin as chairwoman to replace her father.
Shares in tech firm Gemalto featured among the top gainers across Europe yesterday, adding 1.1 per cent after Apple Inc introduced a new mobile payments service dubbed “Apple Pay” with its latest iPhone launch.
Gemalto is a maker of smart chips for mobile phones, bank cards and biometric passports. It pioneered the use of smart cards.
“Apple is the last smartphone manufacturer finally adopting the NFC (Near Field Communications) technology, but this should clearly boost the adoption of this payment technology worldwide,” a Paris-based trader said.
UK’s FTSE 100 index ended flat, while sterling hit a 10-month low against the dollar, with traders citing an online survey on Scottish independence that gave the “Yes” camp a strong lead.
Market talk surrounded another poll due to be released late yesterday by the Survation polling agency for the Daily Record. The agency said on Twitter that those results would be “very interesting”. Shares in Edinburgh-based Royal Bank of Scotland fell 0.6 per cent.
“The market’s scepticism that Scotland will vote for independence on September 18 has been meaningfully tested by recent opinion polls, which have shown the sizeable majority in the ‘No’ camp evaporate into statistical insignificance,” said Toby Nangle of Threadneedle Investments.