What promised to be a better week after a positive first day of trading
ended disappointingly, with the major global stockmarkets finishing the
first week of the third quarter lower.
Further profit warnings, particularly Marconi's, dampened market sentiment
In the US, a shorter trading week stated positively with encouraging
economic data from the National Association of Purchasing Managers showing
a rise in manufacturing activity.
However, a spate of negative statements from over 20 US companies later in
the week sparked a broad sell-off on Wall Street as the losses spilled over
to all sectors.
US unemployment rose for the second time in three months, giving more
scope for a further Fed cut. The technology sector lost all and more of the
gains made in the previous week, with the Nasdaq 100 index shedding 8.1 per
European markets were rocked on Wednesday as Marconi suspended dealing in
its shares ahead of a poor statement. French telecoms company Alcatel and
Ericsson lost 7.5 per cent and 6.6 per cent respectively.
The euro fell to new lows as the eurozone economic sentiment index slipped
further than analysts had expected.
Technology issues suffered in the UK as Marconi ann-ounced that profits
would be half of what had been expected and that 4,000 jobs would be lost.
The company's share price fell by 58.7 per cent over the week as investors
went heavy on John Mayo, ousting him as chief executive designate.