• Last year, IT experts managed to convince us that computers would not be able to figure out that 2000 comes after 1999. Naïvely, many believed that the Millennium Bug could paralyse everything from wristwatches to nuclear power stations.
With hindsight, the war against the Y2K bug was an elaborate hoax but thankfully the next opportunity for IT people to pull the fast one is a long way off in the year 2999, and by then computers should be smart enough to fix themselves. The good news is that many City professionals who sacrificed the festive period to attend to the office computers got, among other fringe benefits, a bird's eye view of the spectacular fireworks that illuminated London's skyline to welcome the new millennium.
Stocks slump in telecoms and IT
• But despite escaping the fangs of the fairy bug the London stock market started 2000 sick as a parrot On the first three trading days of the new year the FTSE 100 fell 483 points, equivalent to a loss of about £100bn. Not surprisingly, the telecoms and IT sectors were the hardest hit. The value of stocks such as BT, Energis, Colt Telecom, ARM Holdings and Sage fell sharply.
Interest rate fears give investors the jitters
• Worries about a possible increase in interest rates appear to be the main cause of the dent in investor confidence Also, after last quarter's spending spree on Internet stocks and fireworks, many investors have started the new year broke and couldn't wait to get their hands on the profits they have made so far.
The London stock market is not alone. Other markets around the world including the US are also suffering due to investors' nervousness over interest rates.
By Paul Audu, Investment Manager