Gloomy results and a profits warning sent Santander Central Hispano (SCH) sharply lower. SCH, Spain's largest bank by assets, fell 3.9 per cent to €8.89 as the group unveiled nine-month figures that fell short of analysts' expectations and cut its full-year profits forecast by 8 per cent.

The ripples quickly spread to its competitor, Banco Bilbao Vizcaya Argentaria, as concerns grew that it too might cut its forecast when it announces nine-month results tomorrow. The shares fell 4.1 per cent to €12.66.

Munich Re, the world's largest reinsurer, took another pounding after a board member was reported to have said the group expected 2001 profits to take a heavy hit from claims related to the attacks in the US. The company also disclosed that the claims could top its current €2.1 billion estimate. The shares fell 3.3 per cent to €311.30. Other insurers were caught in the backlash, with Zurich Financial falling 2.3 per cent to SFr384.50 and Allianz losing 4.1 per cent to €270.55. AXA dropped 3.5 per cent to €25.37 as the French group, Europe's second-largest insurer, ruled out a recapitalisation in the aftermath of last month's attacks in the US and declined to give a forecast for full-year 2001 results.

The telecoms equipment makers were down 3 per cent or more, with Ericsson off 6.5 per cent at SKr46.20.Digital technology group Kudelski of Switzerland initially jumped 10 per cent before falling back to close 4.2 per cent up at SFr98.80.

There was weakness in the IT services sector as Merrill Lynch cut its ratings on Atos and Altran Technologies of France.

On Cap Gemini, the sector leader, it said it was too early to start buying again. Cap Gemini fell5.4 per cent to €64.95, Altran lost 4.3 per cent to €51.85 and Atos was down 0.7 per cent to €82.45. Getronics of the Netherlands fell 3.9 per cent to €3.