LONDON -- Europe's markets were suffering Wednesday morning from a Nasdaq hangover.
The overnight fall in the Nasdaq took its toll on European technology and telecom stocks, and by midday all of Europe's major indices were lower.
fell 28.80 points to 6526.70, led by the major telcos and telephone-equipment makers such as
The blue-chip index's most heavily weighted stock,
remained extremely active. Today it fell back after making a tentative foray into positive territory on talk that it is close to completing a sale of its Italian fixed-line phone subsidiary
. The shares were 2p easier at 271p ($3.80).
However, Vodafone soon could see some relief from the impact of a move to free-float adjustments by the major global indices. Analyst Nick Aldred of
believes that when
all move to free-float, Vodafone will attract fresh buying of around $10.5 billion.
FTSE International will make the change next June, while MSCI has not yet made any formal announcement, although market participants believe it will do so in December. STOXX, the company formed by
, will implement free-float weighting as of Monday, which will increase Vodafone's weighting in the STOXX 50 by 0.14%.
"It's very difficult to estimate the impact," says Aldred. "It will be interesting to see how
Vodafone does react, and it will give us a clearer picture of what will go on in the rest of the world," he adds.
Vodafone seems likely to be a major beneficiary; not only does its weighting in indices such as STOXX increase with a move to free-float, but the weighting of fellow large telcos such as
is reduced. This means that its share in sector-specific portfolios also will increase.
Elsewhere in the telecom sector,
slipped below the 800p level to stand down 9p at 798. On the charts, it looks as if the first support level is way down at 765p.
It's a different story for
, which rang up an 18p rise to 510. The company unveiled its strategy for the unbundling of the local loop next year: It will apply for access to up to 1,000 British Telecom exchanges to provide broadband services to customers across the U.K.
Meanwhile, Spirent said this morning it was buying
, a Texas-based software developer, which will strengthen Spirent's third-generation wireless testing capabilities. The market was unimpressed, however, and shares fell 5.25% to 678.5p.
succumbed to more profit-taking as brent futures moved lower. BP fell 7.5p to 657.5, while Shell slipped 11.5p to 607.
Europe's other major stock markets were lower, as the
in Paris was off 82.77 to 6615.03 and the
in Frankfurt was down 52.85 to 7082.90. The
index was 96.4 lower to 6008.1.
erased early gains made after the bank was no longer considered the likeliest
. Midsession Deutsche Bank was down 1.64 euros to 92.86 ($80.06).
Technology remained weak, with
down 1.38 euros to 65.75,
off 0.45 euro to 178.90 and software maker
3.00 euros lower to 278.00.
SAP Systems Integration
, which debuted on the Neuer Markt Wednesday, surged to 53 euros from its initial price of 19 euros. The offering was 56 times oversubscribed.
Telcos were having a mixed morning, with
up 0.49 euro to 42.90, while
was down 0.22 euro to 23.78 and
was off 1.90 euros to 130.70.