Marconi takes telcos down

Sector feels the knock-on effect...

Extreme profit warnings from Marconi and the subsequent collapse of its share price have forced analysts to reduce their estimates for the rest of the sector. Morgan Stanley is slashing it estimates for Alcatel's earnings per share by 55 per cent, according to reports on Reuters. The news pushed the company's share price down 2.5 per cent. Goldman analysts have joined their peers in downgrading Alcatel and have done the same with Nokia. The Finnish mobile company lost 3.2 per cent during late morning trading. Marconi's poor performance has also sparked rumours that it has become a possible takeover target for market giants Nortel Networks and Cisco. As of 11.40(BST) Marconi was down a further 8.7 per cent.