The four-day sequence of excellent performances from London's stock market, which brought a near 5 per cent gain in the FTSE 100, ground to a halt yesterday.
At the finish of the trading session the FTSE 100 had clawed its way off the bottom, settling a net 70.6 lower at 6,367.8, having hit a low point of 6,330.0, down 108.0, at its worst.
Burdened by the sell-off in the technology, media, telecoms sectors, the Techmark 100 gave back 83.55 to 3,457.70, the worst performance of the leading indices.
The sectors behind the recent rally, pharmaceuticals and TMTs, were mostly responsible for the market's setback and dealers reported genuine selling pressure.
Sentiment in London was negative from the outset of trading, despite the latest good showing by the Dow Jones Industrial Average on Tuesday, which drove up a further 121 points.
Dealers were much more inclined to take note of the late decline in the Nasdaq Composite, which finished 48 points off, having been up around 50 points at one stage.
Behind the slide in the Nasdaq was a poor performance by many of the semiconductor stocks, especially National Semiconductor.
And there was further trouble for London's technology and telecom stocks after Canada's Nortel Networks, the telecoms equipment manufacturer, reported that optical network systems sales did not grow as quickly as the markets expected.
So with the stage set for a slide in the tech-related sectors the last thing London needed was a poorly-received third quarter report from AstraZeneca, one of the leading pharmaceutical groups.
AstraZeneca blamed its bottom-of-the-range results on falling sales of Losec, its anti-ulcer drug, and warned it would not achieve the double-digit growth the market had been expecting for the full year.
Wall Street gave London another bout of the jitters at its opening, the Dow dipping off 85 points and the Nasdaq posting a three-figure slide, on the back of the Nortel news.
The only domestic economic news yesterday was the Confederation of British Industry's quarterly report on industrial trends which painted a rather gloomy picture, pointing to a general lack of confidence among UK manufacturers.
While the drug, telecoms and tech stocks accounted for most of the decline in the Footsie, there was another substantial loser in Railtrack whose shares plummeted more than 6 per cent, as the problems affecting the rail system continued to mount.
Property stocks, especially Land Securities and British Land, were among the worst of the FTSE 100 and 250 losers after the property team at Credit Suisse First Boston lowered its 2001 net asset estimates by 4 per cent and lowered its sector recommendation from overweight to underweight.
