Monday close

Frankfurt

German shares closed lower, pulled down by a weaker start on Wall Street with little buying interest and thin volumes overall, said dealers.

The Dax closed at 5,320.4, down 37.35.

Among the winners was BMW, which closed 0.73% higher at 29 after it said it will become Rolls-Royce's single largest shareholder when it raises its stake in the UK group to 10% in exchange for its 50.5%stake in aero-engine venture BMW Rolls-Royce.

DaimlerChrysler was down 0.2 at 70.6 ahead of nine-month figures out on Tuesday. Volkswagen shed 0.17 to 52.73.

The financial sector was in focus ahead of nine-month results due from HypoVereinsbank and Deutsche Bank on Tuesday and following an auditor's report at the weekend on bad property loans at HypoVereinsbank.

The Bavarian bank closed 0.9% lower at 57.58 after what one dealer called a choppy day's trade.

Munich Re shed 2.5% to 201.5 and Allianz was 8.51 lower at 281.

Siemens closed 0.62 higher at 81.39.

The company said its information and communication networks division won an order worth about 100 million euro from Medi Telecom of Morocco for a mobile phone network.

RWE, which last week announced plans to merge with utilities company VEW, was 1.18 lower at 37.51 after magazine reports saying it also plans to acquire a stake in UK gas company Centrica.

Paris

Early gains by leading French shares were lost later in the day as a weaker start to Wall Street outweighed a number of positive domestic factors, especially optimism about the aerospace sector, dealers said.

The Cac-40 index closed 8.52 points lower at 4,669.28.

Aerospace stocks closed higher, although off session highs, after Dassault Aviation, Aerospatiale Matra and Thomson-CSF said they had agreed, together with SNECMA, to acquire a 20% stake in Brazil's Embraer.

Thomson-CSF ended 0.59 higher at 30.39, Aerospatiale Matra added 0.43 to 21.68 and Dassault Aviation rose 4.70 to 185.

Expectations of a rise in interest rates led to banks being generally lower.

Societe Generale ended 5.9 down at 203, CCF closed 1.2 lower at 113.70, BNP finished 0.2 weaker at 77 and Credit Lyonnais was off 0.4 at 27.3.

Remy Cointreau the session's sharpest riser, adding 1.35 to 19.35 after earnings targets were upgraded by French broker Cheuvreux de Virieu.