July 06, 2007	Friday	Jamadi-us-Sani 20, 1428

LONDON, July 5: Europe's main stock markets mostly dropped on Thursday, overturning earlier gains before interest rate decisions from the Bank of England and European Central Bank.

In London, the share price of Vodafone slid more than one per cent after the Financial Times said the telecommunications giant was poised to lose out to British rival O2 to become the sole network partner for Apple's iPhone in Britain, dealers said.

London's FTSE 100 index of leading shares edged up 0.01 per cent to 6,6673.90 points, while Frankfurt's DAX 30 index fell 0.37 per cent to 8,045.54 points and in Paris the CAC 40 slid 0.29 per cent to 6,080.46.

The DJ Euro Stoxx 50 index of leading eurozone shares decreased by 0.27 per cent to 4,511.70 points. The euro stood at 1.3647 dollars. Markets were awaiting interest rate calls due Thursday from the BoE and ECB.

While the Bank of England is widely forecast to raise its key rate by a quarter-point to 5.75 per cent, the European Central Bank is expected to keep its main borrowing cost at 4.00 per cent, ahead of a hike in September.

Wall Street was due to reopen on Thursday after closing the day before because of Independence Day. US stocks had risen on Tuesday in pre-holiday trade.

In London, Vodafone shares shed more than 1.0 per cent in early trading after the FT reported that O2, the British unit of Spanish telecommunications group Telefonica, is set to be the first European mobile phone operator to reach a deal with Apple over its multi-purpose iPhone.

Telefonica outperformed Madrid's IBEX 35 index, gaining 0.18 per cent to 16.58 euros in morning trade.—AFP