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Losses mount in Europe
November 2, 1999: 4:59 a.m. ET

Main bourses suffer amid interest rate jitters, Dow's drop
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LONDON (CNNfn) - Most of Europe's main markets headed lower in morning trade Tuesday as investors remained jittery ahead of twin interest rate decisions later this week, with sentiment further hit by a late sell-off on the Dow.
     London's FTSE 100 fell 42 points or 0.7 percent to 6,242.4, as the fear of a double interest-rate hike haunted the market. The European Central Bank and the Bank of England both make their decisions Thursday.
     In Frankfurt, the Xetra Dax stood 50 points lower at 5,483.96, a loss of 0.7 percent.
     The CAC 40 in Paris took a heavier hit as it dropped almost 1 percent, or 43 points, to 4,845.89, after a market holiday Monday.
     In Zurich, Swiss blue chips treaded water just inside the minus column, down 13 points at 7,144.1.
     On Wall Street Monday, the Dow Jones Industrial average fell 81 points, while the tech-heavy Nasdaq hit a new record with a small 1.2 point gain.
     Wall Street looked set for a subdued start later Tuesday, with S&P futures quoted 0.5 points higher on the Globex trading system at 1,363.00. London brokers estimate fair value, which takes into account the variable effect of dividend payments and interest costs, at 1,362.31.
     In London, telecom heavyweight Vodafone AirTouch (VOD) hogged the spotlight in early trade as it slumped 3.7 percent, after a strong runup Monday.
     Oil giant BP Amoco (BPA) recovered from earlier losses to trade down just 0.5 percent amid reports that its proposed $27 billion takeover of Atlantic Richfield could be blocked by U.S. antitrust regulators because of concerns over the combined entity's dominance in Alaska.
     Struggling retailer Marks & Spencer (MKS) also bounced back to trade flat after tumbling almost 3 percent at the open. M&S reported a 43 percent fall in first-half pre-tax profits, in line with expectations.
     Bank shares were under pressure as interest rate worries came into focus, with the biggest decliner HSBC (HSBA), down 1.5 percent, followed by Barclays (BARC), which was 1.3 percent lower.
     In Frankfurt, Volkswagen (FVOW) was the main focus as its shares slumped 3.3 percent. Investors bailed out after the auto giant reported a 2.2 percent fall in nine-month pre-tax profits to 3.3 billion marks ($1.8 billion), at the bottom end of expectations.
     In Paris, chipmaker STMicroelectronics (PSGS) was by far the biggest gainer as it soared 6.1 percent. Sentiment was buoyed as U.S. tech stocks managed to hold off negative sentiment on the Dow and post another record close. The second earthquake in Taiwan in six weeks also raised the prospect that the country's semiconductor production could be affected.
     Building materials group Lafarge (PLG) jumped 3.1 percent as investors bet on a new round of consolidation in the sector.
     In Zurich, Swisscom was the biggest loser as its shares fell 2.1 percent after Switzerland's biggest telecom group said it was cutting interconnection fees by 12 percent.
     In Milan, the market debut of utility Enel, saw the shares jumped 2.3 percent in early trade to 4.4 in the world's largest initial public offering. Shares are due to start trading in New York later Tuesday.Back to top
     -- from staff and wire reports


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