Telecoms sector has a tough day in Frankfurt

Interest rate uncertainties, compounded by another weak early showing on Wall Street, sent European markets broadly lower. The FTSE Eurobloc 100 index, which covers leading companies in the euro-zone, closed 9.89 lower at 1,084.05. The FTSE Eurotop 100, covering countries inside and outside monetary union, lost 33.99 at 3,036.73 while the broader FTSE Eurotop 300 settled 13.18 lower at 1,315.64.

Frankfurt closed six points above its low for the session with the Xetra Dax index off 71.51 at 5,327.60 after another day dominated by bond markets and worries about interest rates. Amid widespread profit-taking, telecoms was one of the hardest-hit sectors. Mannesmann tumbled €6.85 to €139.70 and Deutsche Telekom, which has more than doubled in value this year, came off €1.62 at €42.38.

News that BMW is to pump more than $5 billion (€4.8 billion) into its loss-making Rover operations in Britain continued to provide shareholders with a stern test of loyalty. The shares fell €27.80 at €658.15.

Paris retreated after an early rally, depressed by the continued rise in US and European bond yields. The losses among blue chips were concentrated in a relatively small number of stocks, with 11 members of the CAC40 index ending more than 2 per cent lower.

Canal Plus, the media company, performed strongly ahead of today's decision by the football league on the terms of a fresh set of broadcasting rights. The shares finished €5.40, or 2.1 per cent higher, at 263.40.

Madrid drew back as Telefonica, the heavily weighted telecommunications company, fell victim to profit-taking. The general index dropped 3.73 or 0.4 per cent to 912.34.

Amsterdam fell 4.78 to 567.12 on the AEX index. Media stocks, dull lately as investors unwound some of their bid speculation gains, were mixed. Zurich lost momentum after an early round of buying and the SMI index closed lower for a third day, down 45.0 at 7,031.0. Novartis remained in focus but out of favour, losing SFr37 to SFr2,305 (€1443).