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Europe in a tech slump
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September 15, 2000: 3:17 p.m. ET
Tech consultants plunge while oil price rise lifts refiners, hits chemicals
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LONDON (CNNfn) - Europe's major bourses closed lower Friday as telecom and technology stocks submerged indexes in London and Paris while Frankfurt's top gauge nosed higher as gains for automaker Volkswagen offset losses in the chemicals sector.
London's benchmark FTSE 100 index fell 138.2 points, or 2.1 percent, to 6,417.3, accelerating its losses near the close. For the week, the FTSE fell 2.6 percent.
In Paris, the CAC 40 blue-chip index shed 58.18 points, or 0.2 percent, to closed at 6,579.73. For the week, the CAC fell 1.8 percent. 
Frankfurt's Xetra Dax lost 48.96 points, or 0.69 percent, to 6,999.54, with Volkswagen (FVOW) adding 4.6 percent after saying it plans to buy back up to 10 percent of its stock.
Among other top bourses, the SMI in Zurich rose 0.15 percent and Milan's MIB 30 lost 1.2 percent, while in Amsterdam the AEX shed 0.1 percent. 
The pan-European FTSE Eurotop 300, a broad index of the region's largest stocks, fell 0.8 percent to 1,644.73, with its computer services sub-index off 2.2 percent, while its oil and gas sub-index climbed 1.8 percent.
Wall Street was headed lower as Europe's major markets closed. The Dow Jones industrial average was off 0.1 percent and the Nasdaq composite index declined 1.4 percent. 
In afternoon trading in Europe, the euro weakened to 85.96 U.S. cents from 86.45 cents in New York late Thursday.
"The euro can be a serious problem for the U.S. but there is little the European Central Bank can do; it's already raised rates aggressively," James Stewart, an economist at Weavering Capital, told CNNfn. "The euro could gently descend to 80 cents."
Tech, telecom firms lose ground
The FTSE was weighed down by information technology firms after Sage Group (SGE), a business software company, slid 10.8 percent as its broker Deutsche Bank warned some analysts' forecasts of future earnings are too high. But surpassing Sage's drop was fellow IT consultant company CMG (CMG), which plunged 13.7 percent.
In Paris, computer consultant Cap Gemini (PCAP) fell 3.5 percent.
Among telecom companies, network operator Energis (EGS) fell 9.5 percent and network equipment firm Marconi (MNI) shed 8.2 percent and Vodafone (VOD) dropped 1.4 percent. In Paris, France Telecom (PFTE) fell 2.3 percent while Deutsche Telekom (FDTE) rose 3.9 percent in Frankfurt.
In Milan, mobile phone operator TIM fell 2.4 percent and parent Telecom Italia dropped 2.3 percent.
In Germany's tech sector, chip maker Infineon Technologies (FIFX) dropped 2.3 percent.
Spillover from high oil prices
Oil stocks jumped as tensions in the Persian Gulf escalated between key oil producers Iraq and Kuwait, sending crude prices back toward 10-year peaks. Brent crude oil futures for November delivery jumped $1.26 to $33.55 per barrel in London trading late Friday.
Beneficiaries included Shell Transport & Trading (SHEL), up 1.7 percent and BP Amoco (BPA), up 1 percent in London, as TotalFina Elf (PFP) added 1.3 percent in Paris. 
Shares of chemical companies, which rely on oil as a major feedstock, weakened in Frankfurt. Degussa-Huels (FDHA) slipped 1.5 percent, Henkel (FHKA) shed 1.9 percent and Bayer (FBAY) tumbled 3.3 percent.
In other sectors, airline Deutsche Lufthansa (FLHA) rose 3.6 percent after a report said it would allow Deutsche Post to raise its holding in privately held courier DHL International to 75 percent. Deutsche Post and Lufthansa each currently hold 25 percent of DHL.
Europe's defense sector was weaker. French media and missiles firm Lagardere (PMMB) topped CAC decliners, off 4.8 percent, while BAE Systems (BA) plunged 11.1 percent in London. Deutsche Bank cut its rating on the defense company to "market perform" from "buy" on Friday.
U.K. consumer products firm Reckitt Benckiser (RB-) fell 4.6 percent after CCF Charterhouse cut its rating on the company to "trading sell" from "hold" amid concerns over pressures such as rising oil prices. That comes a day after U.S. counterpart Colgate-Palmolive (CL: Research, Estimates) plunged 17 percent after an analyst downgrade. 
-- from staff and wire reports
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