Microsoft head triggers sell-off in hi-tech stocks
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.THE SLIDE in technology stocks continued on both sides of the Atlantic yesterday, spurred by remarks from Microsoft president Steve Ballmer that tech share prices, including those of his own company, had reached "absurd" levels.
That triggered wide-spread selling among US investors, driving the tech- heavy Nasdaq index down nearly 6 per cent on Thursday and through early yesterday afternoon. Microsoft saw over pounds 20bn wiped off its market value, costing chairman and chief executive Bill Gates and Mr Ballmer billions of pounds in paper losses.
"There is such an overvaluation of technology stocks, it is absurd," Mr Ballmer told a group of journalists at a technology conference in Seattle. "I could put our own company and others in that category."
He blamed a "gold rush" mentality for the market rises, saying that profits earned by technology companies don't justify the high prices. "It's bad for the long-term health of the economy," he added.
His remarks helped to drag down European tech stocks yesterday. They also rankled management at Misys, the systems integrator that is Britain's largest technology company. A spokesman for Misys, which fell 31p, or 5.2 per cent, to 564p termed Mr Ballmer's remarks "arrogant". He added: "The reality is that the situation in the States is totally different from the situation in Europe."
Other UK stocks with technology characteristics also fell. GEC, which is becoming a telecoms equipment maker, lost 5.3 per cent, Logica slid 3.8 per cent and Telewest fell 3.4 per cent.
Also weighing on the tech sector were worries about the impact of the recent earthquake in Taiwan on semiconductor and computer component manufacturers. Taiwan supplies 70 per cent of all notebook PCs as well as 80 per cent of high-powered graphic chips.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments