Channel players caught up in the tech stock slide have expressed
exasperation at the unstoppable damage being wreaked on their share
prices.
In the last week, stocks across the world have plunged with
technology shares bearing the brunt of the losses. All of the major
stock market listings, including Nasdaq, Dow Jones and the London
Stock Exchange, saw the slide gain momentum over the course of the
week, fuelled by profit warnings and job cuts from major IT
companies.
A series of milestones were crossed, with the London Stock
Exchange dropping to its lowest level since 1997 and the Nasdaq
falling through its 2,000 level. The bleakest predictions coming
from analysts warn that the FTSE index — which includes Britain’s
largest companies — could drop below the 5,000 level, wiping £200bn
off share values.
Marianne Kolding, European services analyst at IDC, claimed the
problems could continue for some time, until more investors found
the confidence to buy back into the market.
“There are a few brave souls buying up again, but I’m not sure
we will ever get back to the heady highs of two years ago,” she
said, adding market correction might see some more realistic values
being put on firms.
“There is no reason to panic and dump the whole thing, but no
matter how good the results, the company and its prospects are,
even ones which are profitable are losing values and it must be
deeply frustrating for those companies,” she added.
UK-listed tech firms saw shares drop with the likes of
Computacenter, Compel, Morse and Action Computer Supplies all
suffering.
In the last quarter, Compel’s share price has dropped to less
than £1.00 from more than £3.75, Morse shares went down to £3.80
from almost £5.60, Computacenter from £11.00 to less than £4.00 and
Action Computer Supplies to lower than 30p after being £1.20 at the
start of the quarter.
Henry Lewis, chairman of Action Computer Supplies, claimed it
had not self-generated its share price drop, but had been caught up
in the stock market problems and seen its value dip as a result of
external influences.
“Our stock price is 20 per cent off this year’s peak and if you
look at Compel and Computacenter, it’s a similar situation for
them,” he claimed.
Mark Byatt, group marketing director at Morse, said it would
continue to operate as normal and concentrate on its business
rather than focusing on its share price.
The impact of the tech stock slide is also being felt in the US.
Marc Paterson, vice president of managed access services at New
York Stock Exchange listed telecom specialist Infonet, claimed it
was frustrating watching the markets dive and affect everyone.
“We have seen a slide across the board. If you have an
association with a sector you get caught, no matter who has the bad
news.”