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Europe slips on economic fear
LONDON, England (CNN) -- European markets fell in mid-afternoon trading on Thursday as investors worried about the economic impact of the war in Iraq. London's FTSE 100 fell 1.6 percent to 3,733.6 and Frankfurt's electronically traded Xetra Dax slipped 1.8 percent to 2,531.79, while the CAC 40 blue chip index in Paris lost 2.4 percent to 2,719.62. The pan-European FTSE Eurotop 300, a broader index of the region's largest stocks, was down 2 percent, with insurance, media and oil and gas sub-sectors leading declines. U.S. President George W. Bush warned on Wednesday that the was was "far from over" as troops amassed for the final push to Baghdad. The International Monetary Fund said on Thursday a lengthy war and terrorism could undermine a fragile economy. "There is more resistance in Iraq than investors had assumed and there is the threat U.S.-led forces could get bogged down in urban warfare," Arnold Gast, a fund manager at Theodoor Gilissen Bankiers, told Reuters. "The war is an aggravating factor in an already difficult environment for equities. There are structural problems such as the lower capital and consumer spending in recent years as well as the risk of a prolonged higher oil price." European aerospace company EADS (PEAD), which owns 80 percent of commercial aircraft maker Airbus, dived 7.5 percent to 7.64 euros amid concerns the war in Iraq could hurt orders for new jets Air France slid 5.3 percent to 9.23 euros after warning on Wednesday it may not meet this year's profit target and delayed the delivery of seven Airbus planes. Munich Re (FMUV), the world's biggest reinsurer, fell 5.9 percent to 70.82 euros after posting weaker than expected results. (Full story) Span's biggest oil company Repsol lost 5 percent to 13.49 euros after power company Endesa said it would sell its 3.01 percent stake in the company. Boots Group (BOOT) dropped 4.5 percent to 552 pence after Britain's biggest beauty and health retailer said its annual profit would be at the low end of market forecasts. The AEX index in Amsterdam fell 2.4 percent and Milan's MIB30 index dipped 1.6 percent, while the SMI in Zurich declined 1.4 percent. In the U.S. on Wednesday, stock markets closed lower. The Dow Jones industrial average slipped 0.6 percent, or 50.35 points, to 8229.88, the Standard & Poor's 500 fell 0.5 percent, or 4.79 points, to 869.95, while the Nasdaq composite declined 0.3 percent, or 3.56 points, to 1387.45. Wall Street was expected to open sharply lower on Thursday. S&P 500 index futures fell 7.6 points to 860.4 on the Globex trading system, while fair value, a measure that takes account of interest costs and dividend payments, was calculated at 868.38.
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