Roller-coaster ride continues for hi-tech investors

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The Independent Online

High-technology stocks continued to feel the backdraft from Tuesday's wild gyrations on Wall Street with share prices down sharply yesterday across most European markets.

However, the Nasdaq index, which includes leading US technology companies such as Microsoft, regained some of its pose while the UK's techMARK index closed 1 per cent higher at 3768.1.

By mid-afternoon, the Nasdaq was showing a gain of more than 90 points but the Dow Jones was trading in negative territory.

In London, meanwhile, the FTSE 100 index closed 47.7 points lower after an extraordinary day which saw the Stock Exchange paralysed for eight hours by a computer failure.

By the time the market did open in mid-afternoon, many dealers had given up and although the Exchange stayed open two hours later than normal until 6.30pm, only about a third of normal daily share volumes were traded. The FTSE 100 closed down 47.7 at 6379.3 although some dealers continued to trade after hours based on indicative prices.

In Germany, the technology-based Neuer Markt index fell 4 per cent and the Nemax 50 technology index 3.7 per cent while the benchmark DAX index ended 2.55 per cent lower.

France's Nouveau Marche was also left reeling, finishing the day 10.5 per cent down at what was its lowest close since 25 January. The main French CAC index ended 3 per cent down.

The story was similar in Italy and the Netherlands, where a rout of technology, media and telecoms stocks led the main markets down. Italy's all-share Mibtel index closed 2.6 per cent lower with Telecom Italia, Olivetti and Telecom Italia Mobile heavily down.

In Amsterdam, the AEX index of blue-chip stocks gave up 2.3 per cent of its value, hit by a big sell-off of telecoms stocks such as KPN Telecom, Libertel and Versatel.

As US investors struggled to take stock, Wall Street glanced occasionally towards Washington and the White House where President Bill Clinton played host to a conference on the so-called New Economy. Those attending included Alan Greenspan, the chairman of the Federal Reserve, and Microsoft's chairman, Bill Gates. It was a verdict against his company on Monday in its anti-trust case that helped trigger Tuesday's losses.

At the meeting, Abbey Joseph Cohen, the highly influential equities strategist at Goldman Sachs, offered encouragement for anxious investors. "Many of you know that my day job is as a stock market strategist and for the past decade we have been enthusiastic about the outlook for US stock prices ... and we remain so," she remarked.

Wall Street was also waiting on some important first-quarter results due out in the coming days. Yahoo!, which last night kicked off the earnings season, was off $5 1/4 at $1621/8. in the middle of the day.