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News > International
Europe ends lower
October 18, 2000: 1:00 p.m. ET

Tech, software shares slump after IBM sales shortfall; euro hits new low
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LONDON (CNNfn) - Europe's major bourses pared steeper losses to end moderately lower Wednesday as technology and telecommunication stocks bore the brunt of the losses amid concern about the outlook for corporate earnings and interest rates following a rise in the pace of U.S. inflation.

London's FTSE 100 fell 0.9 percent to 6,148.2, led by sharp falls in Internet service provider Freeserve (FRE) and information technology service and software firm Logica (LOG).

graphicIn Paris, the CAC 40 blue-chip index tumbled 2.1 percent to 5,937.35, led by telecom equipment maker Alcatel (PCGE).

Frankfurt's electronically traded Xetra Dax dropped 0.75 percent to 6,483.00, with electronic component maker Epcos (FEPC) and engineering and electronics powerhouse Siemens (FSIE) among the leading decliners.

In Amsterdam, the AEX index fell 0.9 percent, Milan's MIB30 and the SMI in

Zurich each declined 0.4 percent.

   London  click here for the biggest movers on the ftse 100 in London
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The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, fell 0.6 percent, with its information technology sub-index down 5.1 percent while the computer sector fell 3.4 percent.

The U.S. consumer price index rose 0.5 percent in September as higher oil and gasoline prices drove the biggest monthly gain in three months, surpassing the 0.4 percent rise expected by analysts. The index had declined 0.1 percent in August.

european market data

In the U.S., the blue-chip Dow Jones industrial average was down 1.4 percent after earlier slumping more than 4 percent and the technology-heavy Nasdaq composite index was up 0.1 percent, erasing its earlier 6 percent slide.

In the currency market, the euro traded at 83.92 U.S. cents, sharply down from 85.40 cents in late New York trade Tuesday. The currency earlier hit 83.66, below its all-time low of 84.40 cents. European Central Bank President Wim Duisenberg Monday ruled out further central bank intervention to support the euro if the Middle East crisis worsens, sparking a sharp fall the value of the ailing currency.

"We still hold firm to the belief that the euro will fall to 80 cents," Steve Barrow, a currency analyst at Bear Stearns, told CNNfn. "At that level the ECB is most likely to intervene."

Telecom equipment shares tumble


Europe's biggest makers of telecom equipment were among the worst hit, although they pared steeper earlier losses. Finland's Nokia, the world's No. 1 mobile handset maker, was down 5.8 percent and Swedish rival Ericsson lost 6.4 percent. France-based Alcatel dropped 8.2 percent, the U.K.'s Marconi (MNI) fell 4.5 percent. Bookham Technology (BHM), a British maker of fiber-optic components, fell 4.4 percent.

graphicTechnology shares began falling from the start of European trading Wednesday after International Business Machines (IBM: Research, Estimates) had reported after the market close Tuesday that its third-quarter sales grew 3 percent from a year earlier, falling short of analysts' forecasts, although an 18 percent rise in quarterly profit was in line with expectations.

Chipmaker Infineon (FIFX) lost 0.9 percent.

Franco-Italian chipmaker STMicroelectronics (PSTM) reversed earlier losses to end up 2.7 percent. The company earlier said third-quarter net income tripled to $415 million and forecast the fourth quarter would be another period of record financial performance.

In Frankfurt, Epcos was down 5.6 percent while Siemens dropped 4.1 percent.

British Internet security company Baltimore Technologies (BTM) dived 12.9 percent. The company is expected to release details tomorrow of a fund-raising sale of up to $100 million of new shares.

Freeserve plummeted 11.5 on concerns about the outlook for advertising revenue following a drop in the share price of the world's biggest Internet service provider, America Online (AOL: Research, Estimates), on Wall Street.

Information technology consultant Logica (LOG) fell 11.9 percent while Anglo-Dutch rival CMG (CMG) lost 6.9 percent and computer services company Cap Gemini (PCAP) was down 5.7 percent in Paris.

Telecom, media shares caught up in sell-off


Telecom operators also sank into the red, with CAC heavyweight

France Telecom (PFTE) down 3.9 percent while data network operator Equant (PEQU) slipped 5 percent. Deutsche Telekom (FDTE) fell 1.3 percent.

But the world's biggest mobile-phone company, Vodafone Group (VOD), turned around earlier losses to end up 0.5 percent.

Shares in British Telecommunications (BTA) rose 1.2 percent as the company dismissed a Wall Street Journal report that it had ended talks to merge its business services unit with AT&T (T: Research, Estimates).

Media shares also were lower, with Lagardre (PMMB) down 5.3 percent. Vivendi (PEX) fell 4 percent and its pay-TV unit Canal Plus (PAN) lost 4.5 percent. Financial data and news firm Reuters Group (RTR) dropped 3.2 percent. British Sky Broadcasting (BSY) fell 1.2 percent while French broadcaster TF1 (PTFI) rose 0.7 percent.

Outside the tech, media and telecom sectors, Sportswear firm Adidas-Salomon (FADS) fell 4.9 percent in Frankfurt.

Britain's second-largest supermarket firm, J. Sainsbury (SBRY), rose 7.3 percent after announcing that current sales and profits were in line with expectations.

Allianz (FALV) rose 1.9 percent after the German insurer agreed to buy U.S. fund manager Nicholas-Applegate, a privately owned San Diego based investment management firm, for up to $2.2 billion including up-front and performance-related payments. Reinsurer Munich Re [FSE:FMUV2] was up 1.5 percent.

The world's biggest insurer, AXA (PCS), fell 3.7 percent in Paris.

Among banking shares, Deutsche Bank {FSE:FDBK] lost 3.2 percent and Crdit Lyonnais (PCL) shed 1.8 percent. Back to top

--from staff and wire reports

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.