European Midday Update: Tech Selloff in Otherwise Quiet Market

LONDON -- Europe's markets are behaving pretty much as expected. The technology sector was sold off on the back of the Nasdaq Composite Index's slide overnight, while the overall market was fairly quiet because of the lingering uncertainty about the U.S. presidential election.

In London, the FTSE 100 was up just 9 points to 6486, while the Techmark 100 was down 58 points to 3379. Further crimping any trading is an imminent decision from the Bank of England on monetary policy.

One big area of interest was British Telecom(BTY). Shares rose to a session high of 807.5p ($11.47) in a knee-jerk reaction after its earnings results and some clarification from the company about its breakup plans, but as lunchtime approached traders said that everyone was waiting for BT's analysts' briefing. Tension is high, and the fact that the company has not raised its dividend has disappointed some. By midday, BT was down a hefty 34p at 754.

In reality, BT has not unveiled anything new, and ratings agency Standard & Poor said it would leave BT's credit rating unchanged. Darren Sinden from brokers IG Markets said there was good two-way trading in BT but that IG has been advising customers to sell the stock anywhere near 800p. He cites the lackluster reception toward AT&T's(T) breakup plans as evidence that the market is, at least for the moment, not overly enamored of the large former incumbents. There is also a sense that BT has done too little too late.

Highflying tech stocks were grounded following the Nasdaq's 5.4% slide. Predictably, optical component maker Bookham Technology(BKHM) suffered yet another triple-digit loss. By midday, the ever-volatile shares were down 9.8% to 19.29, their lowest level since April 17. Similar fate befell rival Marconi(MONI), which gapped lower at the open and was 33p lower at 837.

In the media sector, EMI surged 7% to 548 after a rumored placing by Schroder Salomon Smith Barney of a block of 8.5 million shares, which should have weighed on the stock but was snapped up immediately, giving rise to hopes that the music publisher is about to tie up with German media giant Bertelsmann. Such a deal makes sense, according to commentators, as Bertelsmann needs other big music groups to join in, if its content distribution deal with Napster is to work.

On the Continent, the markets were lower. The CAC-40 in Paris was down 22 points to 6314 and the Xetra Dax in Frankfurt was down 17 points to 6992.

One huge gainer was Munich RE, which surged 12.59 euros to 385.49 ($327.67) after Goldman Sachs raised its price target to 430 euros from 385 euros and kept it on its recommended share list.

Loser included France Telecom (FTE), down 3.50 euros to 112.00 after Wednesday's purchase of E.On's(EON) 42.5% stake in the Swiss mobile-phone company Orange Communications. Siemens (SMAWY) was down 5.31 to 135.50 as SG Securities cut its target to 155 euros and downgraded the stock to hold following disappointing third-quarter figures.

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