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Flat trade for European markets
LONDON, England -- European markets ended flat on Wednesday, with German drug company Bayer dropping to near 10-year lows. London's FTSE 100 was down 0.18 percent to 3,483.8, after touching its lowest level since July 1995 earlier in the session. Frankfurt's electronically traded Xetra Dax, which was trading until 1900 GMT, gained 0.57 percent to 2686 and the CAC 40 blue chip index in Paris rose 1.43 percent to 2,840.05. The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was up 0.36 percent to 775.45 -- at one point falling to the lowest level since January 1997. Bayer slumped to near 10-year lows on concerns about the group's ailing pharmaceutical unit and its exposure to lawsuits over a recalled drug. Investors fear rising litigation costs over cholesterol drug Baycol, once the mainstay of a business that Bayer is now struggling to spin off. (Full story) The market outlook remained gloomy after President George W. Bush's State of the Union speech on Tuesday where he presented the U.S. case against Iraq and said "some crucial hours may lie ahead'' for U.S. troops. (Full story) "February 5 is the next milestone," said global equity strategist Rupert Thompson at E*TRADE, referring to a pledge by Bush to present the U.N. Security Council next week with new intelligence on Iraqi weapons of mass destruction, ahead of possible U.S.-led attack. "There's also a lot of data next week that may or may not clarify the economic situation. But even if the data is good, I can't see the market making much headway under the circumstances," he told Reuters. Mobile subsidiary Orange (PORA) fell 3.35 percent to 7.50 euros despite meeting market forecasts with a 7.9 percent jump in fourth-quarter revenues and attracting 1.1 million new customers over the key Christmas season. (Full story) Its parent, France Telecom (PFTE), rose 4.62 percent after falling in morning trading. On Wednesday, it posted 2002 sales figures that were in line with expectations. (Full story) The AEX index in Amsterdam was down 0.75 percent, Milan's MIB30 index rose 0.96 percent and the SMI in Zurich lost 0.24 percent. U.S. stock markets sold off early on Wednesday on the heels of the president's speech that indicated a military confrontation with Iraq was nearly inevitable. Iraq and the economy dominated Bush's address to the nation, and Wall Street's reaction the morning after was one of concern at the prospect of war and misgivings about the administration's strategy to bring the economy out of its current downturn. About 10:00 a.m. ET, the Dow Jones industrial average (down 89.26 to 7999.58), the Nasdaq composite (down 11.28 to 1330.90) and the S&P 500 index (down 6.38 to 852.16) all lost about 1 percent on average.
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