European markets were heading for their biggest one-day fall of 2002 in mid-afternoon trade today after New York extended losses as disappointing US data compounded earnings concerns and dashed hopes of a swift economic recovery.
By 3.30 p.m. the FTSE Eurotop 300 index of pan-European blue chips was 2.09 per cent lower while the narrower DJ Euro Stoxx 50 index lost 2.87 per cent.
In New York, the Dow Jones industrial average fell 0.53 per cent, the broader Standard & Poor's 500 Index was down 0.82 per cent and the tech-laden Nasdaq Composite shed over 1 per cent.
Already nervous investors had hoped that the US Institute for Supply Management survey would confirm signs that the world's leading economy is on the mend.
But rather than come above the boom-or-bust line of 50, as expected, the ISM's non-manufacturing business index for January fell to 49.6 from a revised 50.1 in December.
Technology and telecoms were the leading fallers on the DJ Stoxx index of sectors, shedding over four percent and 3.5 per cent respectively.
French telecoms equipment maker Alcatel was the session's biggest blue-chip loser, dropping almost seven percent after US optical network company Ciena rattled the sector by saying its quarterly loss would be wider than expected.
Nokia was also hit by news from Elcoteq, Europe's largest electronics manufacturing services and a Nokia supplier, which said that sales would remain weak in the early part of this year.
Elcoteq shares tumbled 10 per cent, while those of Nokia shed 5.7 per cent.