Share prices fell sharply across Europe this morning following revelations about fraud at US telecommunications giant, Worldcom.
The US-based company, which employs 180 people in Ireland, revealed that it had overstated its income by US$3.8 billion.
On the back of this announcement, some European markets fell to their lowest levels since September 11th.
In Dublin, the market fell by almost 3.8 per cent this morning. By lunchtime, it was trading at 4,639.87 points, down 208.19.
London’s FTSE 100 also fell sharply in early morning trading. The index lost over 185 points, or 4 per cent of its value. Prices picked up slightly as the morning progressed. Just before noon, the index was trading at 4479.4 points, down 3.27 per cent.
Across European markets, the trend was similar. The French CAC 40 index fell below the 3,600 point level for the first time since September, to 3588.89 just before noon.
In Germany, the DAX dropped to below 4000 points. It recovered slightly in late morning and was trading at 4,004.07 at noon.
Stocks fell across all sectors, with telecommunications companies affected particularly badly. The French slump was led by Alcatel. The company’s shares fell 18.9 per cent to EUR 7.58, following a profit warning issued today. Alcatel said that reduced spending by telecommunications companies and customers would lead to reduced profits in the immediate future.
France Telecom also dropped 13.7 per cent to EUR 9.15, also affected by the general fall in telecommunications stock.