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Tough month for techs sees 17% fall

Technology stocks took ano ther big hit when they suffered their worst month of the year in November.

Unit trusts in the technol ogy, media and telecommunications sector plummeted by an average of 17.05 per cent last month, according to the lat est Lipper Tech Fund Bulletin.

The worst-performing fund was Solus technology plus, which dropped by 29.33 per cent, while the best perfor mer, LG global information, lost 5.45 per cent.

The previous worst month was October when funds in the sector dropped by an average of 12.53 per cent.

Over the year so far, the best-performing TMT unit trust has been M&G global technology fund, which has lost 12.46 per cent. At the other end of the spectrum, Framlington NetNet has drop ped by 47.91 per cent.

The poor results are affecting consumer confidence, with Autif figures revealing only £74.8m was invested in TMT funds in November. This represented just 5.9 per cent of total net retail sales of funds.

But a Lipper spokesman says the outlook may not all be gloomy if recent comm-ents by US Federal Reserve chairman Alan Greenspan and the increasing likelihood of George W Bush winning the US presidency have the same positive effect on UK markets as overseas.

Global marketing director Steve Lipper says: “With tech funds, we have gone from exc essive optimism to pervasive pessimism. At a micro level, these funds have been affec ted by earnings shortfalls and profit warnings from technology companies both in the UK and the US.

“At a macro level, there are concerns over the greater pro bability of a US recession next year leading to reduced capital spending expectations and reduced technology sales projections.”

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