European markets end lower

March 5, 2002 Posted: 1745 GMT

LONDON (CNN) -- European markets ended lower on Tuesday, as a global rally ran out of steam and investors sold stocks to profit from recent price rises.

London's FTSE 100 slipped 0.5 percent to 5,214, while the CAC 40 blue chip index in Paris fell 0.6 percent to 4,580.75 and Frankfurt's electronically traded Xetra Dax was flat at 5,243.84 in late trading (the German market was to close at 1900 GMT).

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The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, lost 0.4 percent, with the telecoms, mining and steel sectors among the biggest losers.

The steel sector came under pressure after reports that U.S. President George W. Bush was ready to impose tariffs of 30 percent on steel imports.

French steel producer Arcelor (CELR) lost 6.1 percent, while Anglo-Dutch group Corus (CS) fell 5.3 percent and German steel producer Thyssen Krupp (TKAG), was the top loser in Frankfurt, falling 2.3 percent in late trading.

Deutsche Telekom (FDTE), Europe's biggest phone company by sales, was down 1.6 percent after posting a 2001 loss of 3.5 billion euros. The loss was its first since floating on the Frankfurt bourse in 1996. Other major telecoms were also lower, including France Telecom (FTE) which lost 2 percent, and BT Group (BT) which fell 1.3 percent.

Ericsson, the world's biggest supplier of high-speed mobile networks, lost 2.9 percent, while Nokia, the world's biggest mobile phone maker, slipped 0.4 percent.

Pace Micro Technology (PIC), Europe's biggest maker of television set-top boxes, plunged 67.1 percent after issuing its third profit warning in six months. The company said take-up of its product was declining in the UK because of reduced spending by the cable industry and U.S. take-up was slower than expected.

Vivendi Universal (PEX), Europe's biggest media company, lost 1 percent ahead of its earnings report, which was to be announced after  markets closed on Tuesday.

The airline sector, meanwhile, flew into positive territory, led by 

British Airways (BAY). Europe's biggest airline rose 1.3 percent after Goldman Sachs upgraded the stock to "market outperform" on recovery and restructuring hopes. BA reports February traffic figures later on Tuesday.

KLM, Europe's fourth-largest airline, rose 3.6 percent after saying business was recovering from the effects of September 11. It said passenger load factor, or the number of seats filled, rose 3.7 percentage points to 79.4 percent -- its highest for the last 12 months.

Deutsche Lufthansa (FLHA), Europe's No.2 carrier, was up 1.2 percent in Frankfurt. Last week, it said its load factor was nearing pre-September 11 levels and that it was expanding flights.    

Among Europe's smaller markets, Amsterdam's AEX index rose 0.3 percent while Milan's MIB30 index fell 0.5 percent and the SMI in Zurich lost 0.4 percent.

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In the U.S. on Tuesday, skepticism about some positive economic data                 tainted the Dow at midday, but the tech stocks on the Nasdaq seemed more inclined to celebrate the news and prolong a March rally.

An economic report showed the U.S. services sector recovered in February, after an unexpected contraction in the previous month.

At midday, the Dow Jones industrial average was down 105.45 points, or 1 percent, to 10,481.37, while tech-heavy Nasdaq composite index rose 1.1 points, or 0.1 percent, to 1,860.4.