Nokia knocks Europe lower

German trader watches stocks slide

LONDON, England (CNN) -- European markets ended slightly lower on Thursday as the impact of a sales warning from mobile phone giant Nokia was cushion by optimism over U.S. corporate profits.

Nokia, the world's largest mobile phone maker, fell more than 11 percent in Helsinki after it warned sales would grow between 4 and 9 percent in 2002, down from its previous forecast of 15 percent.

London's FTSE 100 lost 0.7 percent to 5,229.4 and the CAC 40 blue chip index in Paris slipped 0.2 percent to 4,588.83, while Frankfurt's electronically traded Xetra Dax was down 0.8 percent to 5,278.49 in late trading (the German markets was set to close at 1900 GMT).

The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, lost 0.7 percent, with the information technology, electronics and telecom sub-indices leading the declines.

"A warning from Nokia usually hits the market much harder than this," Martin Brooker, strategist at Credit Lyonnais, told Reuters.

"Resilience is due to broadly better U.S. earnings reports and hopes this will be followed by an improvement in European earnings."

Nokia's sales warning pushed Sweden's Ericsson, the world's biggest supplier of high-speed mobile networks, down about 7 percent.

French telecom equipment maker Alcatel (FCGE) lost about 2.1 percent, while German tech giant Siemens (FSIE) was down 2.1 percent in late trading in Frankfurt.

Vodafone (VOD), the world's biggest mobile phone company, dropped 4.3 percent in London, UK rival mmO2 (OOM) lost 1.3 percent and Orange (PORA), Europe's third-largest mobile phone company, fell 1.1 percent in Paris.

Germany's SAP (FSAP), the world's biggest business software publisher, was down 0.1 percent in late Frankfurt trading. Earlier on Thursday, it said first-quarter net income fell 40 percent to 65 million euros ($58 million). Licence revenue -- the basic measure of how much software the company sold -- fell 12 percent to 402

million euros.

UK chip designer ARM Holdings (ARM) was the biggest loses in London, falling 7.7 percent, while STMicroelectronics (PSTM) was the top decliner in PAris, losing 4.5 percent.

Meanwhile, Novartis rose 1.2 percent in Zurich after Swiss drug company said first-quarter net income rose 20 percent to 1.79 billion Swiss francs. It reiterated it was on track to boost drug sales by about 10 percent in 2002.

In Amsterdam the AEX index fell 0.4 percent, the SMI in Zurich slipped 0.1 percent and Milan's MIB30 lost 0.5 percent.

In the U.S. on Thursday, came under some pressure at midday Thursday after weakness in the aerospace sector took its toll on the Dow Jones while selling in wireless and chips held back the Nasdaq.

At midday, the Nasdaq composite index was down 20.22 points, or 1.1 percent, to 1,790.45, while the Dow Jones industrial average was off 72.51 points, or 0.7 percent, to 10,148.27.