Hopes of tech-led bounce demolished

Any hopes of a continuation of Tuesday's tentative tech-led bounce by London's equity market were demolished yesterday by further evidence of crumbling confidence in the US tech stocks after more bearish news from across the Atlantic.

To add to bearish sentiment there was yet another delay in the long-running US presidential election story. All the main FTSE indices ended up with some nasty losses.

London was on the back foot from the outset, with dealers nervous of the follow-through from the damaging news issued overnight by Lucent, the US telecoms equipment manufacturer, and the expectation that US markets would probably back off ahead of today's Thanksgiving Day break, and a curtailed trading session on Friday.

Those fears proved well founded with London opening easier and becoming increasingly vulnerable to any attempted selling.

Another worrying factor, dealers said, was the increased pressure of selling affecting many of the important sectors in the market.

At the close of the session the FTSE 100 was down 160.7, or 2.5 per cent, at 6,221.4, having threatened at one point to take a look at the 6,200 level, eventually bouncing from a session low of 6,216.1.

Dana Petroleum remained unchanged at 15p despite reporting that its latest exploration well, Sidayu-1, has discovered oil offshore east Java, Indonesia.

The junior FTSE indices were given a mauling but managed to evade the worst of the selling affecting the leaders. The 250 index dipped 89.5 to 6,551.7, the worst of the day, while the FTSE SmallCap lost 23.0 to 3,270.1.

Not surprisingly, the worst performance of the lot came from the beleaguered Techmark 100 index which plummeted 175.0, or 5.7 per cent, having touched 2,857.56, as the selling pressure in the TMTs built up momentum. The Techmark 100 has now fallen well over 50 per cent from its March record high of 5,743.

Sentiment in London was not helped by the poor showing by Wall Street at its opening yesterday when the Dow Jones Industrial Average fell over 120 points and the Nasdaq, now well below the 3,000 level, in excess of three figures.