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European mood sours on Ericsson
LONDON, England (CNN) -- European markets slipped lower at midday on Friday as investors pocketed profits from this week's strong gains, as the market mood soured after Ericsson cut its sales forecast and Wall Street appeared headed or a weak opening. London's FTSE 100 was down 2.3 percent to 4,075.4, while Frankfurt's electronically traded Xetra Dax lost 2.6 percent to 3,089.93 and the CAC 40 blue chip index in Paris fell 2.8 percent to 3,095.45. The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was down 2.2 percent. Sweden's Ericsson, the world's largest maker of mobile phone networks, was 3.4 percent lower at 4.62 crowns -- off its morning lows -- after it said losses widened in the third quarter as sales tumbled. It also cut its forecast for the rest of the year. (Full story) Nokia, the world's biggest mobile phone maker, also slipped in early trading following the gloomy Ericsson outlook, after soaring in the previous session on the strength of its own results. It was down 2 percent to 16.15 euros -- also off its morning lows. On Thursday, the Finnish group posted improved profits for the third quarter and said it expected steady earnings for the remainder of the year as demand for new handsets picks up. (Full story) However, some technology stocks in Europe added to gains made on Thursday, which following upbeat results from IBM and Advanced Micro Devices a day earlier. Helping to lift the sector was Microsoft Corp. (MSFT), which late on Thursday said it earned 50 cents per share in its fiscal first-quarter, an improvement over the year-ago quarter, on sales that rose by more than $1 billion. (Full story) Also late on Thursday, Sun Microsystems Corp. (SUNW) reported a smaller-than-expected loss for the latest quarter Thursday, even as sales at the maker of computers and Internet gear were sluggish. (Full story) Germany's SAP (FSAP), Europe's biggest software company, was up 3.3 percent to 71.41 euros. On Thursday, it posted third-quarter results, which beat analysts forecasts, but dropped its 2002 sales forecast due to the uncertain climate in global technology spending. (Full story) France's STMicroeletronics (PSTM), Europe's biggest chipmaker, edged up 0.2 percent to 17.15 euros, while Germany's Infineon Technologies (FIFX), the region's No. 2 chipmaker, rose 2.9 percent to 8.06 euros. ASML, the Dutch semiconductor equipment maker, edged gained 0.7 percent to 8.22 euros. Meanwhile, Cap Gemini (PCAP), Europe's biggest computer services company, was down 3.3 percent to 22 euros -- wiping out earlier gains in the session. On Thursday, its shares soared more than 20 percent after it lowered its second half sales target but said margins would be stable due to cost-cutting measures. Leading the pharmaceutical sector lower was Schering (FSCH), which dropped 9.7 percent to 47.70 euros after the U.S. Food and Drug Administration indicated it would not approve its hormone treatment Angeliq. The AEX index in Amsterdam was down 1.9 percent, Milan's MIB30 index lost 1.5 percent and the SMI in Zurich fell 1.6 percent. In the U.S. on Thursday, upbeat guidance from IBM, Nokia and Eastman Kodak ended the one-day timeout for a rally that has taken the Dow up nearly 1,000 points in five out of the last six sessions. The Dow Jones industrial average was up 239.01 points to 8275.04, while the Nasdaq composite rose 39.87 points to 1272.29 and the Standard & Poor's 500 index gained 19.18 points to 879.20. Wall Street was expected to open slighter lower later on Friday. S&P 500 index futures were down 2 points to 877 on the Globex trading system, while fair value, a measure that takes account of interest costs and dividend payments, was calculated at 881.41.
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