European stocks end lower

January 14, 2002 Posted: 1753 GMT

LONDON (CNN) -- European markets ended lower on Monday, led by telecom and tech stocks, on ongoing concerns over the global economy.

Those concerns were sparked on Friday by Fed Chairman Alan Greenspan who dashed hopes of an economic recovery, saying talk of a U.S. turnaround was "premature." He also raised expectations that interest rates may be cut again to stimulate growth.

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London's FTSE 100 fell 1.6 percent to 5,113.5 and the CAC 40 blue chip index in Paris lost 2.2 percent to 4,453.97, while Frankfurt's electronically traded Xetra Dax were down 2.7 percent to 5,070.08 in late trading.

The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, fell 2.3 percent, with the IT, telecom, electronic and electrical sectors leading the decline.

In addition to Greenspan's pessimistic outlook for the economy, European telecom stocks were pressured by some negative sector news on Monday from a major supplier.

Balda [FSR:BADG], the German mobile phone parts maker, cut its earnings forecast for 2001 after weaker than expected sales, particularly over the Christmas period. Its shares were down almost 15 percent in late Frankfurt trading.  

It also helped push down Finland's Nokia, the world's biggest mobile phone company. Its shares plunged about 10 percent on Monday. Sweden's Ericsson, the biggest supplier of third generation wireless infrastructure, fell 5.5 percent in Stockholm. Siemens [FSE:SIEGn], Germany's No.1 communications equipment maker, was down about 4.6 percent in late trading.

Alcatel (PCGE), France's largest phone equipment maker, declined 4.3 percent. Deutsche Telekom (FDTE), Europe's biggest phone company by sales, slid 4.4 percent in late Frankfurt trading, while Germany's No. 1 communications equipment maker Siemens (FSIE) was also down 4.4 percent.

British mobile phone operator Vodafone (VOD) fell 3.9 percent, while ARM Holdings (ARM), Europe's biggest chipmaker, dropped 3.3 percent.

Spanish stocks, heavily invested in Argentina, fell amid concerns about events in the troubled economy. Madrid's IBEX blue-chip index lost 2.3 percent. Argentina's peso currency dived 41 percent on Friday when a devaluation become effective.

Telefonica, Spain's dominant phone company, fell 3 percent, while

Banco Bilbao Vizcaya Argentaria lost 3.4 percent and SCH, Spain's biggest banks, fell 3.3 percent.

Swiss bank UBS, the country's largest, fell 1.5 percent after collapsed energy giant Enron on Friday said the bank agreed to take control of its key energy trading unit.

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In Amsterdam, the AEX index lost 2.1 percent and Milan's MIB30 index fell 2.5 percent, while the SMI in Zurich slipped 1.8 percent.

In the U.S. on Monday, Wall Street was lower in early trading on concerns that tech stocks have risen too far, too soon, and lingering effects of Fed Chairman Alan Greenspan's mixed review of the U.S. economy on Friday.

The Nasdaq composite index was down 28.48 points, 1.2 percent to 2,022.46, while the Dow Jones industrial average dropped 80.33 points, or 0.8 percent, to 9,987.53.