The carnage continues on equity markets Thursday, as accounting woes hammer away investor confidence once again. At midday the S&P/TSX index is down another 77 points to 6,839.

Volume is heavy as investors flock to the exits, with 153.3 million shares changing hands. Selling volume is trumping the buying by about five to two. Market breadth is a little better, but not much, with losers outnumbering buyers by five to three.

Techs, telecoms and golds are the only sectors holding up today. And those gains are minor. Everything else is being sold, as investors decide that it’s not only telecoms that might be fudging the books.

Confirmation of an SEC investigation into drug giant Bristol-Myers Squibb is hurting the broader market. Health stocks are down 3%. Energy and consumer plays are down 2% apiece. Financials, real estate and materials are weaker, too.

Traders tried to rally stocks this morning, after an opening drop. Markets made their way into positive territory, and then the selling began in earnest once again. Rumours of mutual fund redemptions are also hurting confidence, and traditional bottom fishers are sitting on their hands as the bottoms continue to track lower.

Stocks evicted from the S&P 500 yesterday continue to see heavy trading. Placer Dome is down 0.6% in 3.5 million shares. Alcan has dropped another 1.7%. However, Nortel Networks is up 2.5% on heavy trading of 11.8 million shares. Barrick is flat in active trading.

Energy play, EnCana is leading the way down today, dropping 3.6%. There’s also active selling in Shaw Communications, Rogers, ATS Automated Tooling, MDS, and QLT.

Financials are a notable source of weakness. C.I. Fund Management is down 3.3% on news of its latest results. There’s also selling in Manulife, Industrial-Alliance Life, Scotiabank and TD Bank. Royal Bank is up a bit.

With all this pain, some traders are picking up techs on the cheap. Bargain hunting is boosting Celestica, JDS Uniphase, Zarlink, Research in Motion and Telus. Old economy names, Teck and Northern Orion are up as well.

In earnings news, Mitec Telecom is reporting a full-year loss of $28.1 million. And it said that CICA-mandated accounting changes may result in further good will writedowns in the first or second quarter. First quarter 2003 revenues are expected to be down 10% to 15% as compared with the fourth quarter of 2002.

In other news, Andrx Corporation and Biovail have executed a binding settlement agreement, resolving all pending litigation and disputes between the two companies relating to Biovail’s Cardizem CD and Tiazac and Andrx’s generic versions of these products. As part of the settlement, Biovail agreed, among other things, to provide Andrx with the right to manufacture and market its Taztia XT product free of any and all claims of patent infringement.

Bowater Canada is blaming a mathematical error in a computer model that will force it to reduce previously reported after-tax gains on two timberland sales by $2.7 million, or 5¢ per diluted share, for the fourth quarter of 2001; and by $2.1 million, or 4¢ per diluted share, for the first quarter of 2002. This represents approximately 5% of the total gain on each transaction. These changes will result in a reduction of Bowater’s reported net income for the fourth quarter of 2001 and the first quarter of 2002.

In New York, the same selling pressures are carrying the day. Choppy trading has the Dow Jones industrial average down 180 points at midday to 8,632. The S&P 500 is down 16 points to 905. The Nasdaq composite index is down just points to 1,334.

The S&P/TSX Venture index isn’t escaping the selling either, it is down five points to 1143. Volume is average at 15.7 million shares. Hathor Exploration is the top trader, up 10% on 932,000 shares traded.