The UK's DCS Group was cut nearly in half and Vtech Holdings lost 15 percent of its value Thursday as tech shares continued to slide. Amid the carnage, British Telecommunications (quote: BT) and ARM Holdings (quote: ARM) set new year lows and the techMARK 100 index of high-tech stocks was down 109 points, or 4.3 percent, to 2,429p by 3.30pm GMT.
DCS, an IT systems and automation provider, said it would not achieve a profit for the full year 2000, which it attributed to the continued downturn in the technology market.
DCS was one of the tech high-flyers in early 2000, with a share price above 2,000p, but profit warnings and weak results have seen its price slump to around 100p. In early trading Thursday shares dropped 85 pence, or 47.9 percent, to 92-1/2.
"The tough trading climate has continued and there has, during the second half, been no general recovery in market demand," the company said in a statement.
Meanwhile, shares in consumer electronics maker VTech Holdings sank nearly 30 percent to a five-year low on Thursday morning after reporting a 97 percent drop in interim net profit.
Europe's beleaguered technology, media and telecoms stocks floundered near their lowest levels this year on Thursday, as the Nasdaq index was walloped to yet another year low by more sales warnings from industry leaders.
The DJ Stoxx technology index shed 4.15 percent and carved out a new low of 738 points, while telecoms were off 3.8 percent near a low of 511 points and media fell 3.5 percent to a 414-point low.
Warnings after-hours on slowing fourth quarter sales from two industry leaders, semiconductor maker Altera and personal computer maker Gateway knocked four percent off Nasdaq at the open. The benchmark tech index, its robust reputation tarnished by a series of bone-jarring falls in recent weeks, is now around 36 percent down on the year and some 50 percent off its March peak. By 2.45pm GMT it had slumped a further 4.8 percent to 2,576 points.
"These stocks, TMTs, were tomorrow's stars," said one fund manager. "What's really appalling is the lack of visibility [on sales and earnings]. That's what the market really hates, and although it's becoming a given these days, people can't get used to it."
Traders cited talk that a number of big mutual funds were offloading their technology holdings, but some added that business was in fact very quiet. "Been there, seen that, done it," said one Paris dealer. "We're not seeing anything that resembles panic selling and a lot of people have already got out."
The biggest losers in Europe read like a who's-who of top tech names. Philips led the pack with a 7.35 percent fall, while Alcatel and Nokia shed 5.7 percent and 4.3 percent as Ericsson followed behind.
France Telecom and BT both set fresh year lows, as did British chipmaker ARM Holdings.
Other semiconductor firms pummelled by the US warnings included French-Italian STMicroelectronics, down 4.7 percent and Dutch ASM Lithography, off 8.3 percent.
"The trouble is no one can call the bottom. It will take a US interest rate cut for things to improve and that's not likely in the very short-term. The market really needs it within the next 48 hours and it's just not going to happen," said a Frankfurt-based senior equity salesman.
As the battle for the US presidency dragged into a fourth week, the market's view was that Federal Reserve chairman Alan Greenspan was keeping any monetary decisions under wraps.
Lernout & Hauspie -- once a leading developer of voice recognition software -- filed for Chapter 11 bankruptcy protection in the US after talks with Belgian and German bankers on rescheduling its debt broke down.
Elsewhere, Britain's NetBenefit halved in value after the Internet company warned that slowing activity would hit sales revenues this year and that its chairman was leaving.
Reuters contributed to this report.
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