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Last Updated: Monday, 7 January 2008, 17:44 GMT
Slowdown fears knock EADS shares
Aerial shot of Airbus A380 plane

Shares in Airbus parent, EADS, have fallen sharply, after an investment bank forecast weak orders and advised clients to sell the stock.

Deutsche Bank cut its rating on EADS to "sell" from "hold" and predicted weaker aircraft orders for Airbus in 2008.

Separately, a report in German magazine Wirtschaftswoche said the firm was experiencing production problems with its A400M military transport aircraft.

EADS shares, which are listed in Paris, ended down 7.47% at 19.20 euros.

The shares were the biggest losers in France's benchmark Cac 40 index. The report in Wirtschaftswoche said that the A400M faces problems with its engines, fuselage and wing construction that may delay its first flight scheduled for July.

EADS has said that the company's performance has been undermined by the strong euro, which has reduced the value of its dollar-based earnings.

The airline industry is expected to see slower sales this year as an economic slowdown may dampen appetite for air travel among consumers, analysts say.

Analysts expect airlines to delay ordering new aircraft until signs of an economic recovery emerge.

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