Telecommunications stayed out in the cold amid mounting evidence of a slowing global economy. Leading stocks, hit by broker downgrades earlier this week, continued to stream lower. Within the FTSE Eurotop 300 index, the sector fell to a record low.

France Telecom gave up a further 4.2 per cent at €47.46 after weak second-quarter sales prompted WestLB Panmure to downgrade Mobilcom, the German cellular group in which France Telecom has a 28.5 per cent stake. KPN came off 3.1 per cent at €5.02 and Telefonica 3.2 per cent at €13.12. Sonera fell 1.5 per cent to €6.45.

Deutsche Telekom, struggling to come to terms with a potentially big stock overhang with vendors of Voicestream and Powertel free to sell much of the Telekom equity from September 1, probed a four-year low. The stock fell 4.9 per cent to €20.22 to extend losses to 16 per cent over the past three sessions.

Equipment had an even more difficult session, with Nokia sliding 8.4 per cent to 21.75 as rumours of an impending profits warning from the cellular leader swirled through the markets. Ericsson fell 4.6 per cent to 51.50 Swedish krona and Alcatel 7.6 per cent to €18.25.

Market talk about stake building outweighed gloomy second-quarter results at Commerzbank.

A 2.5 per cent rise in the shares to €26.82 was attributed squarely to speculation that maverick shareholder CoBRa and a group of investors were building a 25 per cent stake in Germany's third largest blue chip bank by market value.

CoBRa investor Klaus-Peter Schneidewind was reported as saying that the group had no immediate plans to increase its stake.

On the results front, a 44 per cent fall in second-quarter net profits, which Commerzbank blamed on poor markets and surging costs, came in line with market expectations.