European markets run out of steam

A trader takes shares orders at the Frankfurt Stock Exchange

LONDON, England (CNN) -- European markets ended lower on Friday as Dell inspired gains were eroded when Wall Street lost early ground, despite some positive economic news out of the United States.

London's FTSE 100 closed down 0.6 percent to 5,218 and the CAC 40 blue chip index in Paris slid 0.5 percent to 4,442.94, while Frankfurt's electronically traded Xetra Dax was off 0.1 percent to 5,041.58 in late trading (the German market was set to close at 1900 GMT).

The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, lost 0.8 percent, with the computer and oil and gas sub-indices among the big decliners. Auto and information technology stocks led the gainers.

In the U.S. on Friday, the University of Michigan said its closely watched consumer confidence index showed that spending was on the rise as the economy continues to recover from its first recession in a decade. (more) Another report, this one from the Commerce Department, showed the U.S. trade gap had narrowed in March. (more)

Late on Thursday, Dell (DELL), the world's leading computer maker, beat Wall Street's first quarter expectations and it raised guidance for its fiscal second quarter, saying that it could earn 18 cents a share on $8.2 billion in revenue. Analysts had been expecting an earnings guidance of 17 cents a share and revenue of $8 billion.

That helped bolster tech stocks in Europe for much of the session before late selling cut into those advances. Chips stocks also notched up early after North American makers of semiconductor equipment recorded an increase in orders in April for the fifth consecutive month.

ASML, one of the world's leading chip equipment maker, ended up 1.3 percent in Amsterdam. Infineon Technologies (FIFX), Europe's second-largest chipmaker, was up 1.3 percent in late Frankfurt trading, while smaller rival Philips Electronics gained 0.6 percent in Amsterdam.

The UK's ARM Holdings (ARM), Europe's biggest chip designer, advanced 1.4 percent -- but off its highs -- in London. Computer software company Sage (SGE) was the top gainer in London, ending up 2.9 percent.

Telecom stocks and equipment makers had a positive session after Switzerland's dominant telecommunications operator Swisscom reported a slight fall in operating income, with net profit below expectations. Swisscom shares rose 0.1 percent. (more)

France Telecom (PFTE) rose 2.1 percent and Telecom Italia was basically flat after posting early gains, while BT Group (BT-), Britain's biggest phone company, which soared more than 9 percent on a well received earnings report on Thursday, fell 2.9 percent as investors cashed in on gains.

Nokia, the world's biggest mobile phone maker, lost 1.6 while Swedish rival Ericsson jumped 6.9 percent. Alcatel (PCGE), the world's fifth-largest telecom equipment maker, gained 0.1 percent -- off its session highs.

Siemens (FSIE), the German electronics and engineering powerhouse, was up 1.1 percent in late Frankfurt trading.

Leading the auto sector higher was DaimlerChrysler (FDCX), the world's fifth-largest carmaker. Its shares were up 2.5 percent in late trading.

The reason for the group's jump in shares "is the resurfacing of reports that Chrysler has introduced new shifts. It's a continuation of a trend but the market reacts positively to indications that demand is better than expected," Michael Raab, auto analyst at Sal Oppenhein, told Reuters.

Volkswagen (FVOW), Europe's biggest automaker, gained 0.3 percent to 57.24 euros, while BMW (FBMW) was up 1.6 percent in late trading.

EADS (PEAD), Europe's biggest aerospace company, said it was sticking to its current earnings and sales forecast as it posted a 25 million euros loss. After initial gains, the company's stock fell 2.7 percent in Paris.(more)

In Amsterdam the AEX index fell 0.8 percent and Milan's MIB30 index lost 0.5 percent, while the SMI in Zurich slipped 0.7 percent.