Frankfurt

Germany's Xetra Dax index of computer trade was down 51 points or 0.8% in early trade at 4826.38.

Focus in European stock exchanges will be concentrated on key interest rate setting meetings in London, Frankfurt and Paris.

The Bundesbank is widely expected to keep interest rates steady despite pressure from members of the new centre-left German government to ease monetary policy.

The debate was fuelled in Germany when a dispute over the Bundesbank's independence intensified late on Wednesday as Finance Minister Oskar Lafontaine received backing for his repeated calls for a cut in German interest rates.

Both German Economics Minister Werner Mueller and the country's trade union umbrella organisation announced their support for an easing of monetary policy in Germany.

A senior Bundesbank council member meanwhile defended Lafontaine from accusations he was seeking to compromise the central bank's enshrined independence and said monetary authorities had responsibilities for the economy as a whole.

Quoted ahead of Thursday's Bundesbank council meeting - which Lafontaine will attend - Mueller said he saw grounds for a small cut in German rates.

Shares in electronics group Siemens surged on Wednesday on news that it plans to spin off its loss-making semi-conductor unit.

"A factor (in early trading) will be whether Siemens can maintain Wednesday's gains," said Milan Stahl, institutional salesman at DG Bank in Frankfurt.

Paris

Share prices opened lower after Wall Street closed well below its early highs and tax cut concerns turned Tokyo negative, dealers said.