Marconi falls to another record low

The Footsie index of 100 leading stocks is off 38.8 points at 5422.8 at mid-morning as tech and telecoms shares suffer more heavy losses.

Telecoms equipment group Marconi has plunged to yet another low, falling 6% or 4p to 67¾p, as investors take their lead from a poor session on Wall Street overnight.

Strong retail sales figures for July, which suggested shoppers were continuing to shrug off concerns about the UK economy, did little to help as they dampened hopes of another interest rate cut by the Bank of England before the end of the year.

Among the fallers, telecoms equipment group Energis is off 5¾p at 88½p; Telewest Communications has dropped 2¾p to 67¼p; Colt Telecom has fallen 7½p to 275½p; and Vodafone has shed 3¼p to just 133¼p.

Among the tech stocks, chip designer ARM Holdings has fallen by 5% or 14½p to 274¾p; computer services group CMG has dropped 8¾p to 238¼p; software firm Misys has edged down 13p to 337p; Sage has shed 1¾p to 205½p; while Electrocomponents is swapping hands at 510½p, off 11½p.

Elsewhere, shares in advertising group WPP have slipped 12½p to 675p after it emerged earlier in the session it was in talks to launch a counter bid for media buying agency Tempus, whose share price is down 5p to 585p. French firm Havas Advertising last month offered 541p a share for Tempus, valuing the group at £425m.

As investors switch out of tech and telecom stocks, defensive shares are faring well.

They are being led by aerospace group BAE Systems, up 10¼p to 343¾p; and Six Continents - formerly Bass - which has moved ahead by 17½p to 738p, helped by an upgrade.

Outside the Footsie 100, online retailer lastminute.com has failed to inspire the City with strong third-quarter figures. Its shares have edged up just ¼p to 34½p.