By around 6:50 a.m. London time 31 out of the 32 counts had been declared and unionists remained firmly in the lead with some 55 percent of the vote against independence.
In his losing speech, Scottish nationalist leader Alex Salmond demanded the U.K. government meet its promise of more powers for the country. "Scotland will expect these to be honored in rapid course," Salmond said.
Meanwhile, Former finance minister Alistair Darling, who was at the forefront of the Unionist campaign, thanked his supporters and said that it was a "momentous result" for both Scotland and for the United Kingdom.
Spread betters in the City of London are calling markets sharply higher with the FTSE 100 expected to start the day with a triple-digit gain. U.K. lenders like Lloyds and RBS likely to be in focus. Both companies are based in Scotland but had planned to re-domicile in England in the case of a "yes" vote.
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Meanwhile, sterling has spiked on the news and reports show that currency traders in London have stayed up during the night to place bets on the foreign exchange markets as the votes come in.
The pound had dipped to below 1.62 against the dollar just a few weeks ago with polls showing that the pro-independence campaign had taken a narrow lead. The currency appreciated in recent days in anticipation of the union staying together. By 6:00 a.m. London time sterling climbed to 1.6467 against the dollar after trading at around 1.63 on Thursday. Against the euro it reached a two-year high on Friday morning.
"Clients had spent yesterday steadily building up long positions in sterling and the FTSE as they bet that cooler heads would prevail and the Union would remain in tact," Marius Paun and Jonathan Sudaria, two market analysts from Capital Spreads said in a morning note.
"The old market adage of 'buy the rumor sell the fact' may still hold because if you're leaving it to this morning to buy on post referendum euphoria you may be getting in at the top."
The argument over whether an independent Scotland could keep the pound had been raging for months, and U.K. banks and Scottish-based firms have also seen a dip in stock prices.
There was also uncertainty about the debt burden that an independent Scotland would share with the rest of the U.K., and the country has also been given a potential sovereign risk rating in the lower BBB region, one notch above junk, by risk rating group IHS.