OCTOBER 26, 2000
It's a volatile world out there...
FORMULA 1 might be switching over from tobacco to high technology sponsorships but the sport still needs to watch out for intense activity in that sector of the market. On Wednesday technology stocks tumbled after Nortel announced its third-quarter results. These were better than some analysts had predicted but this did not stop investors from panicking and the shares dived by 25% before computers overloaded and sales had to be halted. On Wall Street Nortel's share value dived 29% and the knock-on effect throughout the industry saw many other similar companies taking big hits. These included Benetton sponsor Marconi plc which lost seven percent of its value on the same day.
The slump in share value should not have any effect on either company's sponsorship but if the markets remain this volatile there are sure to be victims in the longer term.
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