Telecommunications group Cable & Wireless continued to weigh heavily on the FTSE-100 Index yesterday (Wednesday), losing a further 8 per cent as investors digested an earlier warning that earnings would fall short of expectations.
Cable & Wireless results hit Footsie
Cable & Wireless, which also announced plans to axe 4,000 jobs, dived 47p to 498p in the first hour's trading.
The group's slump, which follows Tuesday's 20 per cent dive, helped push the Footsie further towards the 5,700 barrier. By 9am, it was down 7.3 points at 5713.4.
Initially the Footsie rose by 20 points following a return to form by most of the new economy stocks caught in the previous tech-led bloodbath.
Investors in London took their lead from a rally overnight in the US, where bargain hunters helped both the Dow Jones Industrial Average and the tech-dominated Nasdaq to bounce back.
The pattern was reflected on the London Stock Exchange, with software groups in particular returning to form.
Cambridge software firm Autonomy was up by more than 5 per cent, ahead 67p at 12.99, while Misys moved ahead 9p at 565p. Sage was also moving into positive territory, up 5p at 295p.
Of the telecom stocks, mobile phone giant Vodafone pressed up 43/4p at 2033/4p and BT followed suit, posting a 9p rise to 544p.
Colt Telecom also moved ahead 15p to 10.73, while Telewest Communications was up 21/4p at 1311/4p.