Share trading in Eads, the three-nation aerospace group, got off to a disappointing start in Paris, Frankfurt and Madrid.

The €3 billion worth of shares were offered at €19 each to institutions and €18 to private investors but were soon at a discount to both, closing at €17.50 in Paris.

In early evening trade in Frankfurt the shares were quoted at €17.64, while in Madrid they closed at €17. One analyst noted that the Madrid price was for immediate settlement, rather than at the end of the month in Paris and Frankfurt. Two weeks ago Eads expected a €22 to €24 price range.

Analysts said investors were cautious about the prospects for the €12 billion A3XX superjumbo being built by Airbus, in which Eads has an 80 per cent stake. The complex merger process and dual management team were also seen to be weighing on the shares.

Frankfurt failed to make much progress on a day in which financials and Eads were in the spotlight and retailers led the decliners. At 5.30 p.m., the Xetra DAX index was just 13.77 easier at 7,038.45.

Among financials, Commerzbank was 14 cents higher at €38.72 and Dresdner Bank put on 50 cents to €43. The two are set to continue talks on a possible tie-up this week. Traders have said that a full merger would be seen negatively by the market but limited co-operation in some areas would be welcomed.

Insurer Munich Re fell €13.20 to €307.30 on worries that new Stoxx weightings rules could affect its position in the pan-European indices.

Tech stocks gave up early gains, leaving Epcos 50 cents weaker at €108 and SAP 14 cents easier at €195.75. Metro led retailers lower, falling €1.50 to €43 after recent sharp gains on merger speculation.

Paris closed lower, pulled down by weakness across old and new economy stocks and the poor start for Eads. The CAC-40 index lost 78.55 or 1.2 per cent to 6,487.42, with 28 of the shares falling.

Telecom stocks had a bad day. Bouygues fell 5.9 per cent to €71.05 and network services provider Equant fell 5.2 per cent to €43.51. However, Lagardere, which owns 11 per cent of Eads, was up 0.8 per cent to €77.10. Credit Lyonnais fell 5.1 per cent to €46.50 as its chairman dismissed suggestions that it could be taken over by Societe Generale or Credit Agricole.

Amsterdam rose slightly, with the AEX index up 0.6 per cent at 678.83. The biggest blue-chip gainer was ASM Lithography, up 3.7 per cent at €46.