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Europe plagued by retail woes
LONDON, England (CNN) -- European markets ended lower on Wednesday as a weak opening on Wall Street helped to accelerate losses that swamped the retail sector after a profit warning from UK giant Dixons Group. London's FTSE 100 lost 0.8 percent to 3,924.8 and the CAC 40 blue chip index in Paris fell 2.1 percent to 3,094.08, while Frankfurt's electronically traded Xetra Dax was down 2.7 percent to 3,028.32 in late trading (the German markets was set to close at 1900 GMT). The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was down 1.3 percent. Dixons (DXNS), Britain's biggest electronics retailers, dived 21 percent to 115 pence after saying sales had been weaker than expected and full-year profits would miss analysts' expectations. (Full story) Other European retailers slid lower amid concerns that consumer spending may be flagging. Kingfisher (KGF) lost 7.8 percent to 200.29 pence and GUS (GUS) fell 4.3 percent to 545.33 pence in London. France's Pinault Printemps Redoute (PPR) dropped 7.7 percent to 64.40 euros and Casino (PCA) slipped 2.8 percent to 68.95 euros in Paris, while Metro (FMEO) of Germany was down 3.1 percent to 22.80 euros in late Frankfurt trading. "Dixon's warning is further proof that retail sales, one of the key engines of European growth, is slowing," Roger Hornett, chief executive and global strategist at Gilissen Securities in London, told Reuters. Saul Henry, a European strategist at UBS Warburg investment bank, added: "We are seeing consumer confidence weakness across Europe and the worry is that this part of the economy will weaken further." However, Britain's third largest clothing retailer Next (NXT) bucked the downward trend, rising 3.2 percent to 770 pence after reporting tough trading conditions over the Christmas period but saying full-year profits would at least match analysts' consensus forecasts. (Full story) Meanwhile, German utility RWE (FRWE) was down 0.5 percent to 26.26 euros in late Frankfurt trading after posting earlier gains. It said operating profit rose at least 12 percent in its 2002 business year to more than four billion euros, boosted by strength in its core utilities businesses. (Full story) EasyJet (EJZ), Europe's biggest no-frills airline, fell 4.2 percent to 272.45 pence after it said its passenger numbers grew almost 40 percent in December but it still had too many empty seats as it increased capacity, sending its shares lower. (Full story) Technology stocks were also weaker on Wednesday after personal computer maker Gateway (GTW) warned of a deeper quarterly loss than previously expected, citing disappointing holiday spending and aggressive sales promotions that crimped margins. STMicroelectronics (PSTM), Europe's biggest chipmaker, fell 4.4 percent to 20.13 euros, German rival Infineon Technologies (FIFX) was down 3.8 percent to 7.62 euros in late Frankfurt trading and Philips Electronics lost 5.2 percent to 17.30 euros in Amsterdam. Nokia, the world's biggest mobile phone maker, fell 5.2 percent to 15.02 euros, Sweden's Ericsson dipped 3.4 percent to 7.05 crowns, France's Alcatel (PCGE) slid 3.3 percent to 4.73 euros and Siemens (FSIE) of Germany was down 5.3 percent to 42.26 euros in late Frankfurt trading. The AEX index in Amsterdam fell 1.8 percent, Milan's MIB30 index dipped 1 percent and the SMI in Zurich was off 0.1 percent. In the U.S. on Wednesday, markets fell after Alcoa -- the first Dow stock to report its earnings -- said it had severe shortfalls in profit and revenue for the fourth quarter. And several downbeat announcements coming from the technology sector were enough to sour the mood on the Nasdaq as well. (Full story) At 1500 GMT, the Dow Jones industrial average was down 78.03 points to 8662.56 and the Nasdaq composite slipped 17.61 points to 1413.96. The S&P 500 index lost 7.29 points to 915.64.
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