LONDON, June 19: European stocks lurched back into loss on Wednesday, with technology stocks leading markets lower on disappointing news from their US counterparts which added to concerns about the quality of corporate earnings.
Asian markets also fell heavily as recent volatility on world stock markets showed little sign of abating and investors braced for a bumpy ride on Wall Street once trading got under way.
Across the 12-nation euro zone, the Euro Stoxx 50 index fell 2.4 per cent to 3,112.2 points.
In London, the FTSE 100 index of leading shares dropped 1.2 per cent to 4,646.9 points, the DAX 30 fell 2.3 per cent to 4,330.6 points and the CAC 40 index eased back 1.9 per cent to 3,930.3 points.
The euro rose to $0.9574.
It’s definitely a sit-on-the fence scenario, said Mark McCutcheon, head dealer at Gerrard Stockbrokers.
People might be acting like sheep but they like to see the comfort of not being the first to take the plunge and so we are still drifting, he told AFP.
There’s obviously a danger of new support levels being tested in the short-to-medium term, but most people longer term still feel that the fundamentals are OK. That being said we need some liquidity and some volume to drive the market higher, he added.
Traders marked down technology share prices after US software giant Oracle and computer maker Apple warned of more tough times ahead in their results posted after the close of US trading on Tuesday.
Their comments were expected to weigh on US markets when trading got underway again after an erratic session on Tuesday that saw the Dow Jones industrials edge ahead 0.2 per cent and the tech-laden Nasdaq index fall 0.7 per cent.
Asian markets added to the negative tone after Japanese share prices plunged 3.4 per cent on Wednesday and Hong Kong stocks dropped 1.6 per cent.
Technology and telecoms stocks were among the main losers in Europe.
The price of shares in British mobile telephone operator Vodafone fell 2.7 per cent to 90.75 pence after the group said it had awarded a share bonus of 1.5 million pounds to its chief executive Chris Gent, despite a fall of almost 50 per cent in the company’s share price this year.
Rival telecoms companies were also under the hammer.
In Paris Alcatel shares slumped 5.0 per cent to 9.6 euros, France Telecom shares dropped 3.9 per cent to 15.67 euros while shares in its mobile telephone operator Orange wilted 2.8 per cent to 5.56 euros.
In Helsinki shares in mobile handset maker Nokia fell 4.4 per cent to 13.44 euros.
Semi-conductor groups also suffered after US computer chip maker Advanced Micro Devices said Tuesday it expected to post a “substantial” operating loss for the upcoming second quarter, due to a weak consumer PC market.
ARM slumped 6.7 per cent to 143.25 pence in London, Infineon lost 6.4 per cent to 15.73 euros and Epcos gave up 4.5 per cent to 33.65 euros in Frankfurt, while STMicroelectronics fell 3.5 per cent to 23.79 euros in Paris.
Shares in French media group Vivendi Universal slumped 4.2 per cent to 28.92 euros.
But shares in German carrier Lufthansa inched up 0.1 per cent to 14.07 euros after chairman Juergen Weber told the annual shareholders’ meeting that the airline was targeting operating profit of around 400 million euros compared with only 28 million euros in 2001.—AFP
