Shares in Frankfurt moved lower with the Xetra DAX index slipping 1.3 per cent or 103.84 to 7,694.78.
HypoVereinsbank was a rare firm feature, driven higher by takeover talk. Stronger links with Munich Re were said to be on the cards, with the insurance giant favoured to increase its 6.5 per cent in the bank.
Hypo rose #2.26 or 3.8 per cent to #62.01 while Munich Re gained #2.95 to #328. Other financials lost ground. Deutsche Bank shed #1.54 at #70.30.
BMW lost #1.05 at #33.40 as the group's top management met with British Trade and Industry Secretary Mr Stephen Byers to discuss the restructuring of the German group's Rover operations.
Deutsche Telekom came off #1.80 at #85 in spite of a press suggestion that the flotation of Internet service provider T-Online set for next month could be worth #38.5 billion.
In the Neuer Markt, Mobilcom tumbled 21 per cent or #41 to #158 following the acquisition of a 28.5 per cent stake by France Telecom.
Paris ended flat after spending the day in negative territory in spite of the strong performance by the Nasdaq, which the CAC-40 has increasingly been following. The index closed 10.98 lower at 6,268.31.
It was pulled down by Aventis, the drugs and chemicals group formed from the merger of Rhone-Poulenc and Hoechst. The company reported bigger-than-expected losses and suffered a 4.6 per cent fall to #55, down #2.65. France Telecom had a volatile day after announcing the acquisition of a 28.5 per cent stake in Germany's Mobilcom. It fell during the morning, then rallied to close up #5 at #183.
Amsterdam was forced lower by steep falls for market heavyweights. The AEX index fell 7.46 to 671.89.
Royal Dutch tumbled 2.7 per cent or #1.59 to #58.40 amid British tax concerns and as international oil prices consolidated at lower levels ahead of this month's OPEC meeting.
Philips took little comfort from the early gains for the Nasdaq, slipping #2.65 to #182.35. Unilever fell 65 cents to #48.25.
Zurich edged lower as investors largely ignored an interest rate rise by the Swiss National Bank.
The SMI index gave up 28.0 to 7,360.2 after the bank raised its target range for three-month inter-bank interest rates by a greater-than-expected 75 basis points to counter inflationary risks.
