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European bourses decline
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September 19, 2001: 12:34 p.m. ET
Tech, telecom, oil and gas stocks fall on more U.S. profit warnings, jobs cuts
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LONDON (CNN) - European bourses ended sharply lower Wednesday as more U.S. companies added to the economic gloom.
Eastman Kodak (EK: Research, Estimates), the world's largest maker of photographic products, said third-quarter earnings will fall short of lowered targets and it will eliminate jobs to cut costs.
And Boeing (BA: Research, Estimates) warned it will slash up to 30,000 jobs as airlines cut back on orders, reduce schedules and trim jobs to cope with an economic slowdown, and a drop in travel demand in the wake of last week's terrorist attack in the United States.
In London, the FTSE 100 lost 125.4 points, or 2.6 percent, to 4,723.2, while the CAC 40 blue chip index in Paris shed 81.25 points, or more than 2 percent, to 3,888.93, while the late-trading Xetra Dax in Frankfurt fell 11.03 points, or 2.6 percent, to 4,083.82.
In midday trade in the U.S., the Dow Jones industrial average declined 208.97 points, or 2.3 percent, to 8,694.43, while the Nasdaq composite index shed 51.24 points, or 3.3 percent, to 1,503.84.
"The markets are having a tug of war between those who feel there will be a recession and those who do not," Khuram Chaudhry, markets strategist at Merrill Lynch, said.
But Ernst Welteke, president of Germany's central bank, the Bundesbank, was upbeat in his outlook, telling CNN: "The economies of the U.S. and Europe are strong enough to overcome the present difficulties.
He said Germany, Europe's largest economy, would have "positive growth" this year and next. "Consumer confidence in Germany is still high and there will be healthy growth in the second half of this year. I do not feel pessimistic," he added.
Airlines remained under pressure as travelers curtail plans to fly. European airlines will meet the European Union's top aviation official Thursday to discuss possible emergency aid.
British Airways (BA-), which is heavily dependent on its transatlantic routes, lost 6.3 percent in London and German flag carrier Lufthansa (FLHA) was down 1 percent in Frankfurt.
UK internet services company Cable & Wireless (CW-) was the second-worst performer on the FTSE 100, losing 12.1 percent after warning its first-half revenue is expected to fall 5 percent amid bankruptcies in the telecom sector and pricing pressure.
British engineering and automation systems company Invensys (ISYS) was the biggest faller, plunging 25.6 percent to a 10-year low of 42 pence, as deepening economic gloom was expected to make the company's recovery even harder.
Shares of Shell Transport & Trading (SHEL), which owns 40 percent of Royal Dutch/Shell, Europe's biggest oil company, fell 4.9 percent after its parent cut its forecast for oil and gas production.
Other energy companies followed suit as Brent crude futures for November delivery dropped 37 cents to $26.90 on London's International Petroleum Exchange. A drop in oil prices leads to a decline in earnings for energy companies. BP (BP-), the world's third-largest publicly quoted oil company, dropped 3.9 percent and France's Total Elf Fina (PFP) declined 6.4 percent.
Tech and telecom stocks, which had featured strongly across Europe in earlier trading, dropped into negative territory at the close.
Europe's No.2 chip maker, Infineon Technologies (FIFX), dropped 7.8 percent, its bigger rival STMicroelectronics (PSTM) dipped 5.2 percent, and Philips Electronics, the No. 3 chipmaker and the Continent's biggest consumer electronics maker, declined 3.1 percent.
Europe's biggest IT services company, Cap Gemini (PCAP), lost 7.6 percent and SAP (FSAP), Europe's biggest business software company, fell 6.8 percent.
In Amsterdam, the AEX index fell 2 percent while the SMI in Zurich declined 1.4 percent. Milan's MIB 30 was down 1.9 percent.
The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, fell 2.4 percent, dragged down by the aerospace and defence and oil and gas sectors. 
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