The two-day rally in London stocks ran into the buffers yesterday. A shock profit warning from IBM, the US computer giant, hit Wall Street overnight and again at the outset of US trading yesterday as a handful of leading British companies proved major disappointments to the market.

That disappointing news stole much, but not all, of the glory from Orange, whose shares spiralled upwards after news of the expected agreed bid from Mannesman, the German group. But the sell-side news in the market proved overwhelming and the FTSE 100 index eventually finished with a sharp fall. It provided hard evidence for the market's lack of conviction on Wednesday when London showed a reluctance to chase Wall Street's sparkling performance.

At the finish of a day of continuing and exceptionally heavy turnover in all the telecoms issues, but particularly Vodafone and Orange, the FTSE 100 settled a net 67.4 lower at 5,939.3.