Tech stocks fall after downbeat news from IBM and Microsoft

The FTSE 100 Index is off 12 points at 5126.4 after an hour's trading.

High-tech stocks are easing after IBM and Microsoft issued gloomy updates following Wall Street's close, where the Dow Jones Industrial Average ended 137 points ahead.

Chip designer ARM Holdings, which had suffered earlier in the week after a mixed update from US semiconductor group Intel, has seen its share price fall by 10½p to 314½p.

Computer services firm Logica is down 17p at 593p; and software company Sage is off 2p at 239p.

Vodafone, the most heavily traded stock during the first hour, is down 1p to 164½p.

The uncertainty surrounding the tech sector means investors are favouring defensive stocks, so GlaxoSmithKline is up 51p at £16.91.

P&O Princess is up 5p at 414p after US cruise giant Carnival tabled a higher offer to try to scupper P&O's previous agreement to merge with Royal Caribbean.

Carnival's combined cash and shares bid is now worth €4.4bn - an increase of 12% on its first proposal - and P&O Princess has said it will consider the offer "in detail".