The biggest losers in Europe were again the technology and telecoms stocks, following two more crucial profit warnings and a plunging Nasdaq.
Philips led the pack with a fall of 8.4 per cent to €38.01 and a massive 34 million shares changing hands. Its share price was hit by warnings from US chip-maker Altera and computer company Gateway, plus a downgrade from Lehman Brothers from "buy" to "outperform".
The Paris heavyweight France Telecom fell more than 5 per cent to €96.50, its lowest level for more than a year, while Dutch telecoms network operator Versatel fell 17.9 per cent to €11.50 after the collapse of merger talks between its partner North-Point Communications, a US high-speed Internet provider, and Verizon Communications.
One analyst cited speculation that US investors were shifting portfolios and dumping Versatel shares.
Chip stocks were hit by a downgrade from Credit Suisse First Boston on several US stocks. Chip equipment maker ASM Lithography shed another 6.6 per cent to €24.11, while Franco-Italian STMicroelectronics was off 5 per cent.
Getronics, the Dutch computer services company, lost another 8.7 per cent to €6.
In Switzerland, the broadcast technology group Kudelski fell more than 20 per cent to a five-month low before clawing back to 8.8 per cent down at SFr2,020 (€1,337). Other falls included Alcatel down 6.6 per cent, Siemens off 4 per cent and Nokia off 3 per cent.
The renewed outbreak of public hostilities between French luxury goods giant LVMH and Gucci, the Dutch-listed rival LVMH has been attempting to acquire, sent the former down steeply in heavy trading.
