LONDON (CNN) - Europe's main bourses closed lower Thursday even after the European Central Bank cut interest rates.
Falls on Wall Street in early trade further dented investor sentiment in Europe.
London's FTSE 100 closed 1.4 percent lower at 5,339.7, while the blue chip CAC 40 index in Paris ended 2.7 percent lower at 4,705.22. Frankfurt's electronically traded Xetra Dax was down 2.3 percent at 5,183.26.
The central bank cut its official interest rate by 0.25 percentage point to 4.25 percent. But the move disappointed some in the financial markets, who had hoped for a larger reduction.
"The ECB should be aggressive and cut by half a point, " Bear Stearns economist Steve Barrow said ahead of the decision. "The euro zone economy has stalled, growth is flat. A more aggressive approach is necessary."
The euro, which had been trading at $ 0.9082 before the ECB announcement, was a shade higher at $0.9138 when the markets closed.
In Amsterdam, the AEX index fell 1.6 percent and the SMI in Zurich was down 0.9 percent, while Milan's MIB30 index slipped 2.2 percent.
Spirent warns of rocky times ahead
There was a wide-spread sell-off of tech stocks, with the Information Technology and Computer sub-indices heading the losers on the pan-European FTSE Eurotop 300, which fell 1.9 percent.
In London, the UK's Spirent (SPT), a maker of telecom test equipment, plunged 17 percent to become the FTSE 100's main loser after saying its results in the year's second half would be depressed by difficult conditions in North America and increasingly, Europe. The company announced plans to eliminate 500 jobs.
Cable TV operator Telewest (TWT) was the next-worst performer, falling more than 12 percent, while Colt Telecom Group (CTM), a provider of business telecom services, ended 10.6 percent lower.
Troubled telecoms equipment maker Marconi (MONI) was 8.4 percent down.
In Paris, Alcatel (PCGE), Europe's No. 4 telephone equipment maker, was the CAC 40's weakest performer, falling 7.5 percent.
France Telecom (PFTE) closed 5 percent down after making an unscheduled release of some first-half profit figures, revealing that earnings before interest, tax, depreciation and amortization rose 14 percent to  6.07 billion ($5.5 billion), in line with analysts' expectations. .
Chip makers and related stocks fell after Sun Microsystems (SUNW: Research, Estimates), the leader in the field of network computing, said late Wednesday it probably will post a third-quarter loss.
STMicroelectronics (PSTM), Europe's biggest chipmaker, fell more than 4 percent and second-ranked Infineon Technologies (FIFX) dropped 3.8 percent. Europe's leading chip designer, ARM Holdings (ARM), lost nearly 8 percent in London.
Europe's largest electronic components maker, Epcos (FEPC), was Frankfurt's heaviest faller, losing 5.6 percent, while engineering and communications company Siemens (FSIE) slid 5.2 percent.
Telecom stocks also fell. Sweden's Ericsson, the world's biggest supplier of high-speed wireless infrastructure, dropped 3.7 percent after a senior Ericsson official, Ingemar Blomqvist, said the company does not see any signs of improvement in the market.
Underlining that point, Finland's Nokia, the world's biggest maker of mobile phones, was down more than 7 percent.
In the U.S., the Nasdaq composite index fell in early trade Thursday after a warning from Sun Microsystems increased investor jitters that a U.S. economic rebound remains elusive.
Despite some glimmers of economic hope, corporate visibility remains murky, leaving investors disheartened, waiting on the sidelines for better news.
The Nasdaq composite index fell 23.65 points to 1,819.52, while the Dow Jones industrial average fell 35.74 to 10,054.37. 
|
