European Midday Update: Markets Fall as Profit-Takers Take Over - TheStreet

LONDON -- All good things come to an end, as investors saw in Europe's markets Tuesday morning as the recent run-up in technology and telecom stocks came to an abrupt halt.

Inevitably, it was the IT services stocks, which led the recent bull run in London's markets, that started the rot. Despite computer services firm

Sema

reporting first-half results at the top end of analysts' expectations, the headline figures did not delight investors, who were disheartened by the absence of a positive trading statement to go with the results. The shares slid 225p to

11.25, setting the tone for markets as a whole.

The

FTSE 100

fell 28 points to 6770, while the

Techmark 100

bore the brunt of the downturn in sentiment and plunged 4%, or 168 points, to stand at 4119.

Investors rushed to take profits in Sema's peers.

Logica

, which reports first-half results Wednesday, fell 137p to

22.43, while

CMG

was down 47p to

13.70.

A slew of technology stocks also shed recent gains, including

Parthus Technologies

(PRTH) - Get Report

, whose shares had soared an astonishing 75% since announcing an licensing agreement with

ARM Holdings

(ARMHY)

last week. Parthus fell 27.5p to 381, while ARM slid another 46.5p to stand at 831.5.

Media stocks too were out of favor, succumbing to profit-taking.

BSkyB

(BSY)

shed 45p to stand at

11.68, while

Carlton Communications

(CCTVY)

was down 19.5p to 765.5.

Telecom stocks were mixed.

Vodafone

(VOD) - Get Report

, which spent an part of early trading in the red, staged a recovery to stand at midday up 9.75p to 294.75. The rise, boosted by reports that

Albacom's

chief executive is interested in buying Vodafone's Italian fixed-line business

Infostrada

, did much to offset the weakness in the rest of the market.

British Telecom

(BTY)

fell 18p to 885.

Europe's other stock markets were lower, with the

CAC 40

in Paris down 35 points to 6887 and the

Xetra Dax

in Frankfurt off 22.95 to 7422.61. The

Neuer Markt's

tech-heavy

Nemax 50

index was 25 lower at 6419.

Many of the Continent's technology and telecom shares were experiencing a technical retreat after surging Monday.

Siemens

fell 1.10 euros to 188.10 ($168.93),

Epcos

(EPC) - Get Report

was down 1.30 euros to 115.50 and software maker

SAP

(SAP) - Get Report

was 4.78 euros lower to 304.70.

Deutsche Telekom

(DT) - Get Report

was off 0.12 euro to 48.89,

France Telecom

(FTE)

was down 3.80 euros to 147.60 and

Telefonica

(TEF) - Get Report

was down 0.22 euro to 24.17.

Carmaker

DaimlerChrysler

(DCX)

was down 0.14 euro to 58.31 amid continuing speculation the company is preparing to increase its stake in

Mitsubishi

. Rival

Volkswagen

was off 0.70 euro to 49.50.

Financial stocks were higher, with

Deutsche Bank

up 0.80 euro to 98.60 and French insurer

AXA

(AXA)

up 1.00 euro to 161.00.