D. Telekom, techs and politics pummel eurostocks

European stock markets fell for the fifth straight session yesterday as Deutsche Telekom issued poor figures, tech shares dived and political tremors were felt from Kashmir to the Brooklyn Bridge.

The latest falls left benchmark indices anchored in the bottom quarter of their six-month trading range, having lost around 3.5 per cent since this time last week.

"The economy in Europe is pretty awful and the corporate sector is in more trouble than people care to admit," said Roger Nightingale, London-based consultant at Swiss bank Sarasin.

"And now we can add in some fairly scary politics as well. The idea that what was done in the aftermath of September 11 was a successful war against terrorism is obviously nonsense."

By 1558 GMT, the FTSE Eurotop 300 index of pan-European blue chips was down 1.49 per cent while the narrower DJ Euro Stoxx 50 index was off 1.59 per cent.

Wall Street was lower after a skittish morning in which prices fell, rose rapidly and then sank again.

The Dow Jones industrial average was 0.33 per cent lower and the tech-laden Nasdaq Composite slipped 0.71 per cent.

News that police had closed Brooklyn Bridge to investigate a suspect package put Europe`s markets in an uneasy New York state of mind for much of the day, and prices failed to recover even when the package was found to be safe and the bridge reopened.

Rising tension on the disputed border between India and Pakistan also made for nervous trading, sending investors scooting into safe-haven assets and pushing the price of gold to its highest level since October 1999.

Technology stocks, and particularly the volatile telecom equipment makers, bore the brunt of the sell-off in equities, chastened by the Nasdaq`s two per cent fall on Tuesday.

Nokia tumbled 8.6 per cent and Swedish peer Ericsson gave up 7.1 per cent.

Observers said they saw no specific reasons for the Nordic duo`s sharp pullback other than the problems which have plagued the sub-sector since the start of the year.

"There`s just a lack of confidence that these companies will deliver the growth that investors have anticipated and analysts have calculated into their figures," said Ollipekka Elovainio, fund manager at Nordea Investment Management in Helsinki.

Goldman Sachs cut its earnings estimates for European software firms to rub salt into the tech sector`s wounds.

It also slashed its share price target for Europe`s biggest software house SAP, which fell 6.6 per cent to new lows for the year.

Shares in indebted Deutsche Telekom fell 5.1 per cent after it said core profits grew by a less than expected 4.4 per cent to 3.8 billion euros in the first quarter.

Other telecom incumbents fell in sympathy, including France Telecom, down 3.5 per cent, and Spain`s Telefonica, off 2.5 per cent, although BT and Telecom Italia eked out fractional gains.

"BT is probably the best positioned of the big five as it doesn`t have that problem of debt, it`s got (mobile arm) mmO2, which is very transparent, and it`s come out with some fantastic results recently," said Raj Karia, telecoms analyst at Canaccord in London.

The only sector in positive territory was autos, which hit a 51-week high before easing slightly.

US-German carmaker DaimlerChrysler, which accounts for over a third of the sector index, roared ahead by 2.3 per cent and compatriot Volkswagen was also strong after CSFB raised its price target for the stock.

Among standouts, Britain`s biggest holiday group, MyTravel Group, tumbled 24.2 per cent after warning of lower profits, dragging German peer Preussag, Europe`s largest travel group, 6.4 per cent lower.

Shares in British pubs group Punch Taverns were trading at 242 pence, up about five per cent from its 230 pence per share issue price on its first day of conditional trading on the London Stock Exchange.

Thursday`s market focus will be on banks and financials, with Dutch group ING, Germany`s Hypovereinsbank and Europe`s largest municipal lender Dexia due to report.

The United States publishes durable goods data for April.