Over £2 billion was wiped off the value of the Irish stock market yesterday as share prices continued to fall in response to renewed heavy selling of both old and new economy stocks on Wall Street.
While part of the 3.7 per cent fall in the market was down to the fall in Eircom shares, there was losses across the board with financial, industrial and technology shares all suffering from the poor sentiment.
Dealers said they see little improvement until the global interest rate environment becomes clearer, with speculation that both the Federal Reserve and the European Central Bank are lining up further interest rate rises within the next few weeks.
Analysts said Wall Street is fearful that further increases in borrowing costs could decelerate spending on computer products.
From the opening bell, share prices on Wall Street fell sharply. The Nasdaq index was down 6 per cent at one stage but recovered later to close down 26.14 at 3364.26, while the Dow Jones index of the top 30 shares fell 84.30 to 10,542.55
The Euro Stoxx 50 index slid 2.34 per cent while the Eurotop 300 index ended down 1.68 per cent.
Irish shares fell heavily with technology shares suffering the most. London-quoted Baltimore fell 51p to £3.68 sterling and is now a virtual certainty to lose its FTSE-100 listing next month along with three other stocks that joined the index in April - Psion, Thus and Kingston Communications.
Baltimore is also suffering from the hangover from the big share sales last week by chairman Mr Henry Beker and chief executive Mr Fran Rooney. The £3.68 sterling close yesterday compares with the share's high of £15 earlier this year.
--(Additional reporting by Reuters)
