LONDON -- In contrast to the euphoria that rippled through Europe's markets Tuesday, Wednesday was marked with introspection.

The

FTSE 100

lost a hefty chunk in Tuesday's gains as it slumped 75 points to 6363, although it was off its low of 6017. On the Continent, the

CAC-40

in Paris was down 81 points to 6243 and the

Xetra Dax

in Frankfurt was down 72 points to 6731.

Wednesday's selloff was almost as broad-based as Tuesday's rally. Anything remotely telecom-related was hammered after

Nortel's

(NT)

third-quarter revenue

failed to meet Wall Street's highest expectations, and investors had a bad case of the jitters ahead of

AT&T's

(T) - Get Report

earnings later Wednesday.

The Nortel announcement inevitably hit fiber-optic companies such as

Bookham Technology

(BKHM)

and

Alcatel

(ALA)

.

Bookham was the FTSE 100's biggest faller, shedding 12.9% to

24.35 ($35.31). However, trading in the stock was so thin that a bus could've been driven through the spread, exacerbating the reported moves. Alcatel was down 6.00 euros to 74.00 ($62.16).

Semiconductor stocks also suffered from Nortel's blow.

ARM Holdings

(ARMHY)

slid 27p to 673, shrugging off an encouraging note from

Goldman Sachs

TST Recommends

. But

Parthus Technologies

(PRTH) - Get Report

held up well after announcing a licensing deal. The shares slipped 5p to 269.

In telcos,

Vodafone

(VOD) - Get Report

was down 6 pence to 269,

Colt Telecom

(COLT)

was 6.5p lower to 278.5 and

Energis

(ENGSY)

was down 16p to 538.

British Telecom

(BTY)

was volatile following reports that it has called off its talks with AT&T, which itself says it intends to split into four companies. BT's shares, which had fallen to a session low of 748p, recovered a degree of poise to stand just 9.5p lower at 778.5.

Drugs have not provided any relief.

AstraZeneca

(AZN) - Get Report

fell 158p to

30.92 after announcing increased profits in the third quarter but lowering estimates for full-year revenue.

This weighed on

Glaxo Wellcome

(GLX)

, which fell 43p to

19.77, and its merger partner

SmithKline Beecham

(SBH) - Get Report

, which slipped 25p to stand at 898.