Wall St tumbles as Net stocks stumble

It really is the wibbly wobbly Web…

Cracks are starting to show in the much-hyped world of Internet stocks. Falling prices have shaken confidence in the technology sector, and Nasdaq - heavily weighted with techno-stocks - shed more than 60 points in early trading yesterday before recovering. Sceptics are saying that this confirms their early opinions. An analyst from Freidman Billings Ramsey told the Financial Times: "We knew these stocks were overvalued, based on hype and emotion. The only question was when people would wake up to reality." Freeserve lost nearly five pence, stopping at 201p, and AOL fell more that 10 per cent yesterday, following Microsoft's announcement of its plan to compete in the Internet access market. The slump is being blamed on US interest rates. Fear that the US economy is overheating has made investors more cautious. This hit Internet stocks especially hard as they are a speculative investment. ® Daily Net finance news from The Register

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