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US interest rate cut prompts European tech surge

London stocks opened sharply higher this morning after a record Nasdaq surge yesterday was prompted by the US Federal Reserve's decision to cut US interest rates.

By Joey Gardiner

Published: 4 January 2001 08:49 GMT

Tech stocks - which have taken a severe battering since New Year - led the charge this morning, with the Techmark index up 6 per cent, while the FTSE 100 rose 2 per cent on early trading.

Early winners include Autonomy, whose rollercoaster ride continues - up almost 10 per cent this morning, making some headway against the 25 per cent drop in its share price over recent days. Network company Orchestream, B2B specialists Infobank and mobile handset maker Psion are also amongst the early winners.

Yesterday the Nasdaq recorded an unprecedented 14 per cent gain after Federal Reserve boss Alan Greenspan decided to cut US lending rates. Investors hope lower interest rates will buoy up consumer spending in the wake of fears of a US economic slowdown. Yesterday's big US gainer was Cisco, which rode the Nasdaq wave of recovery to record a 25 per cent gain to close at $41.31 a share, cancelling out all of its losses of recent days.

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