Techs hit by Marconi suspension, BSCH reduces Vodafone stake, Marconi sells medical unit
By Philip Stafford, FTMarketWatch 9:07:00 AM BST Jul 4, 2001
LONDON (FTMW) -- London technology stocks slid at the open on Wednesday after shares in telecoms equipment maker Marconi [UK:MONI] were suspended pending a trading statement. Blue-chips also edged lower.
"The market is expecting a negative statement from this and that's what's hitting the techs," said Martin Dobson, head of trading at NatWest stockbrokers in London.
The FTSE TechMARK [UK:1859502] fell 1.5 percent while the FTSE 100 index [UK:1805550] lost 0.3 percent, following the cautious path taken by New York overnight.
Telecoms testing equipment maker Spirent [UK:SPT] fell 9 percent, while Bookham [UK:BHM], which relies heavily on Marconi business, fell 6 percent. Chip designer ARM Holdings [UK:ARM] lost 7 percent.
In separate news, credit ratings agency Moody's cut the ratings for Nortel [US:NT], one of Marconi's largest competitors, because of weak demand for phone equipment.
Indices are expected to be quiet with U.S. markets closed for the Independence Day holiday. Following a slew of profit warnings in recent weeks, markets are unlikely to stray too far from recent trading levels
The Dow Jones [US:DJIA] closed down only 0.2 percent while the Nasdaq [US:COMP] lost 0.4 percent.
BSCH sells Vodafone, BA falls
However, Vodafone [UK:VOD] fell 2.3 percent after Spanish bank BSCH said it reduced its stake in the world's largest mobile operator to 1.6 percent from 2.7 percent for a total of £974 million, removing some of the doubt surrounding the company's share overhang.
British Airways [UK:BAY] fell 3.7 percent after Dutch rival KLM [NL:00964] warned on first quarter profits, saying it would be substantially below €100 million. The Sunday Times recently reported that BA has restarted merger talks with KLM after talks failed last September.
However, software group Anite [UK:AIE] rose 4.7 percent after it posted better than expected results. See more on Anite
South-African IT consulting company Dimension Data [UK:DDT] fell another 4.7 percent, after Tuesday's 30 percent decline following a warning on slowing sales. See more on DiData
ARM Holdings [UK:ARM] fell 7.1 percent and telecoms testing equipment maker Spirent [UK:SPT] was off 7.1 percent.
Marconi unit sale
Separately, telecoms equipment maker Marconi [UK:MONI] said it sold its medical systems unit to Dutch electronics maker Philips [NL:PHIA] for $1.1 billion. The deal will make Philips the world's second largest maker of medical diagnostic imaging equipment. See more on Philips
U.K. electrical retailer Dixons [UK:DXNS] rose 2 percent after it reported full-year pre-tax profit up 37 percent, at the top end of expectations.
Supermarket chain Iceland [UK:ICE] fell 4 percent after it reported full-year profit fell to £40.1 million, in line with expectations, after a difficult trading year which saw the company move away from its frozen food business. See more on Iceland
Philip Stafford is a reporter for FTMarketWatch in London.
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