Thursday, September 16, 1999 Published at 10:59 GMT 11:59 UK
Business: The Company File
London to launch technology exchange
Traders will have a separate index for technology stocks
The London Stock Exchange is to launch a technology market in November.
The new technology index - called techMARK - is expected to include over 170 stocks already listed on the main market.
The main advantage of a separate technology market is that it offers start-up companies an easier route to raise cash.
Investors will also have a single index which they can use to track the performance of the UK technology sector.
New listing rules will be aimed at making it easier for firms with a limited trading record to qualify for a public quote. Currently a three-year trading record is required to list on the exchange.
The index is expected to include listed stocks ranging from the blue chip FTSE 100 to the FTSE fledgling index of companies.
Companies in the following sectors will be automatically included in the index: computer hardware, computer services, internet, semi-conductors, software and telecoms equipment.
Some sectors which have a technology component, such as aerospace, electrical equipment and fixed-line telecoms services, could be included as well.
Europe catches up
Fear had existed that the UK could miss the boat over Internet stocks because of the lack of a suitable growth market to list on. The UK is a relative latecomer to the idea of a technology index -the US has the Nasdaq technology index while Germany has the Neuer Markt.
Europe in general has been slow to follow the US lead in embracing the importance of new technologies and the potential of the companies involved in the sector.
The London Stock Exchange, fighting to defend its position against European rivals such as Frankfurt, is keen to promote itself as having experience in the sector.
The interest generated by the flotation of Internet Service Provider Freeserve in July has added to the pressure on the exchange to provide better opportunities for similar but smaller companies.
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