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FTSE 100 at 2016 levels amid world tech slump

World stock markets have been falling sharply again, with the FTSE 100 returning to levels not seen for almost 22 months during Friday trading.

While a slew of strong corporate earnings from the likes of Tesla and Microsoft (Euronext: MSF.NX - news) which helped drive a recovery in values on Thursday, Asia markets tipped south on the final day of the week.

That was after results from Amazon and Alphabet (Swiss: GOOGL-USD.SW - news) - Google's owner - disappointed.

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Traders suggested the tech sector's earnings season is being closely-watched because of long-held fears it is hugely over-valued.

It is also exposed to the US trade war with China, which chimes too with worries about the damage tariffs will inflict on the world economy at a time when US interest rates are rising - raising borrowing costs.

The FTSE 100 followed Asia in dropping steadily as a slew of company results across Europe failed to boost sentiment.

London's premier share index closed 2% lower in choppy late afternoon trading but staged a late rally to close just 0.9% lower.

The German DAX and CAC 40 in Paris were down by more than 1%.

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US markets fell sharply at the open, with the tech-dominated Nasdaq (Frankfurt: 813516 - news) down by 3% placing it in technical correction territory.

One UK analyst, Neil Wilson of markets.com, described the performance as FAANGs (Facebook (NasdaqGS: FB - news) , Apple (NasdaqGS: AAPL - news) , Amazon, Netflix (Xetra: 552484 - news) and Google) determining that Halloween had come early in a "nightmare month for equities".

Investors sought safe havens such as government bonds and the yen after Amazon's revenue expectations for its crucial fourth quarter came in way below analysts' forecasts of 22% growth.

The online retailer-to-cloud services firm estimated a jump of up to 12% only. Its stock fell by up to 9%.

Alphabet (Xetra: ABEA.DE - news) 's revenues missed forecasts.Its stock was more than 5% lower on Friday.

It meant more than $100bn of market value had been erased from just those two stocks, traders said.

The FTSE 100 has little exposure to tech stocks.

But RBS was among the main fallers when it became the first major UK lender to take a provision for economic uncertainties ahead of Brexit.

Shares (Berlin: DI6.BE - news) in the engineering firm Rolls-Royce suffered falls of more than 8% at one stage following a media report of delays with its engines for Airbus.

Barclays (LSE: BARC.L - news) shares failed to rally despite a court ruling that the Serious Fraud Office could not reinstate charges over the bank's Qatar fundraising at the height of the financial crisis.

The pound slipped below $1.28 - a seven-week low - at one stage as negotiations with the EU on an exit deal continue to show little sign of an immediate breakthrough.

It later recovered some poise on Friday afternoon as US economic figures for the third quarter, showing growth a 3.5% rate of annual growth, failed to strengthen the dollar.

Hussein Sayed, chief market strategist at FXTM, said of the market mood: "In an environment of rising interest rates, trade tensions, signs of slowing economic growth, and lots of geopolitical uncertainty, earnings and future forecasts need to be exceptional for investors to continue buying stocks.

"Otherwise, the consequences will be severe. This is especially the case where investors have an alternative to equities, which is fixed income."