SINGAPORE, Sept 19 — The pound headed for its biggest two-day jump in seven months, UK and European share-index futures rose and Treasuries fell as Scotland voted to reject independence. The yen fell, while Japanese equities and US stock-gauge futures climbed.

The pound gained 0.4 per cent to US$1.6466 (RM5.33) by 7.08am in London, taking its two-day advance to 1.2 per cent, and FTSE 100 Index futures added 1.1 per cent. Euro Stoxx 50 Index futures rose 1.2 per cent. The yield on 10-year Treasuries climbed four basis points while S&P 500 contracts gained 0.3 per cent following another record in New York. The yen plunged through 109 per dollar to trade at the lowest since August 2008. Malaysian bonds rose after the central bank held rates. Wheat hit a four-year low.

Scotland’s First Minister Alex Salmond conceded defeat after the anti-independence ‘No’ camp garnered 55 per cent of the vote. About US$145 billion was added to the value of global equities yesterday as US jobless data beat estimates a day after the Federal Reserve pledged to keep rates near zero for a considerable time after ending bond purchases. Alibaba Group Holding Ltd raised US$21.8 billion selling shares in the biggest US initial public offering.

The Scottish vote is “a relief for the market,” Hans Goetti, the Singapore-based head of investment for Asia at Banque Internationale a Luxembourg SA, which has US$40 billion in assets. “A source of instability has been taken out, which is good for the market. It’s back to risk on. The British pound is dramatically off its lows.”

Pound rallies

The pound was stronger against all 16 major currencies, climbing 0.5 per cent to 1.2758 euro, the highest since August 16. The FTSE 100 snapped a three-day drop yesterday, adding 0.6 per cent, while yields on 10-year gilts rose six basis points, or 0.06 percentage point, to 2.58 per cent yesterday.

Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc are set to rise with results from 31 of 32 districts showing Scotland will stay in the UK, avoiding months of turmoil that may have seen the lenders relocate to England. The two banks, both domiciled in Edinburgh, said last week they would move to England if Scots chose to dissolve the 307-year-old union.

Benchmark US 10-year yields rose three basis points to 2.65 per cent, according to Bloomberg Bond Trader data. The US five-year yield rose four basis points to 1.866 per cent.

Investors who had purchased Treasuries as a hedge against financial market turbulence during the vote on independence are unwinding the trade, said Kazuaki Oh’e, a debt salesman at CIBC World Markets Japan Inc. in Tokyo.

Yen retreat

The yen plunged 0.4 per cent to 109.12 per dollar, near the weakest since August 2008. Japan’s currency is the worst— performing of 16 major currencies versus the dollar this quarter, losing more than 7 per cent since the start of July. New Zealand’s dollar experienced the the second-biggest decline.

Japan’s Topix is headed for a third straight weekly advance, rising 1.1 per cent today. Australia’s S&P/ASX 200 Index added 0.5 per cent today, while South Korea’s Kospi index gained 0.3 per cent.

Hong Kong’s Hang Seng Index increased 0.6 per cent, paring a second weekly decline, and the Hang Seng China Enterprises Index slipped 0.2 per cent. The Shanghai Composite Index increased 0.4 per cent.

Alibaba and shareholders including Yahoo! Inc. sold 320.1 million shares in the Hangzhou, China-based company for US$68 each, after offering them at a range of between US$66 and US$68, according to a statement. The IPO—which values Alibaba at US$167.6 billion—is already the largest by any company in the US and has the potential to break the global record if additional shares are sold to underwriters.

Gold slump

SoftBank Corp, which owns more than 30 per cent of Alibaba, climbed 0.6 per cent in Tokyo. Beijing Hualian Department Store Co, a shopping mall operator that has a partnership with Alibaba, gained 2.4 per cent in Shenzhen.

Gold for immediate delivery traded at US$1,223.95 an ounce from US$1,225.15 yesterday, when the metal dropped to US$1,216.03, the lowest since January 2, according to Bloomberg generic pricing. The 14-day relative strength index held below 30 for a seventh day, the longest streak since June 2013, signaling prices may be poised to rebound.

Malaysia’s benchmark three-year bonds rose by the most in more than four months, pushing their yield down nine basis points to 3.51 per cent. Bank Negara Malaysia held its overnight policy rate at 3.25 per cent late yesterday. The decision was predicted by 11 of 21 economists surveyed by Bloomberg News, while 10 forecast a 25 basis-point increase.

Jobless claims

The ringgit dropped 0.2 per cent to 3.2355 per dollar, contributing to a 1.4 per cent weekly drop that would be the currency’s biggest loss of the year.

US jobless claims decreased by 36,000 to 280,000 in the period ended September 13, data yesterday showed, while another report indicated the housing market recovery remains uneven, with fresh home construction down 14.4 per cent in August, the most since April 2013.

The Fed tapered stimulatory bond buying by US$10 billion for a seventh time, staying on course to end the programme as soon as next month. Officials said the economy is expanding at a moderate pace and inflation is below its goal.

Wheat futures for December delivery slipped 0.7 per cent to US$4.8525 a bushel, reaching their lowest price since July, 2010. Soybean futures due in November fell 0.4 per cent to US$9.6725 per bushel, extending yesterday’s 1.1 per cent drop, while corn lost 0.2 per cent to US$3.375 a bushel, headed for a weekly decline of 0.4 per cent. — Bloomberg