Tech firms expelled from FTSE elite

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Eight media and hi-tech firms have been demoted from the elite club of the UK's top 100 listed companies. The firms relegated from the FTSE 100 shares index are: Marconi, Carlton, Colt Telecom, Telewest Communications, Misys, CMG, Energis and Spirent.

Meanwhile, the companies promoted are a collection of 'old economy' stocks: Friends Provident, Enterprise Oil, Wolseley, Severn Trent, British Land, Man Group, Northern Rock and Innogy.

The latest reshuffle, which is undertaken four times a year, marks the dramatic turnaround in fortunes of the tech sector.

In March last year, at the height of the 'new economy' boom, nine technology and media stocks were promoted to the index. But the collapse of the tech bubble has sent shares in software, dotcom and telecoms companies tumbling.

Whether a company is in the FTSE 100 can have an important bearing on its share price. Investment funds which track the FTSE 100 are obliged to buy shares in these companies which means their share price tends to rise. Likewise companies which are heading for relegation usually see their share price fall.

The changes will come into effect on the 24 September.

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