December 04, 2007	Tuesday	Ziqa'ad 23, 1428

LONDON, Dec 3: European stock markets were generally lower on Monday in a muted start to the week, as investors eyed forthcoming interest rate decisions in Britain and the eurozone.

In early afternoon deals, London’s FTSE 100 index of leading companies eased 0.23 per cent to 6,417.80 points. In Paris the CAC 40 slid 0.12 per cent to 5,663.85, while Frankfurt’s DAX 30 edged up 0.04 per cent to 7,873.86 points.

The DJ Euro Stoxx 50 index of top eurozone shares fell 0.21 per cent to 4,385.87 points.

The European single currency stood at $1.4656.

Interest rate calls are due Thursday from the Bank of England and the European Central Bank, which are both widely expected to hold their key rates at 5.75 per cent and 4.00 per cent respectively.

However, the accompanying ECB statement will be closely watched for hints towards a potential rate cut in the new year.

Interest rate cuts are a boost for companies because they reduce loan repayments and the cost of doing business and they increase the amount of disposable income available to consumers.

In London on Monday, troubled bank Northern Rock topped the FTSE 100 fallers board, with its shares losing 4.24 per cent to 113 pence.

British finance minister Alistair Darling has asked Northern Rock to consider rival bids to the one launched by Richard Branson’s Virgin Group, the Financial Times reported Monday.

In Paris, investors paused to take profits from last week’s gainers, with bank stocks in focus. BNP Paribas stock retreated 1.35 per cent to 76.11 euros and Credit Agricole shares sagged 1.29 per cent to stand at 23.71 euros.

However, the main story of the day was French group Vivendi, whose share price leapt 2.58 per cent to 32.20 euros.

Over the weekend, Vivendi said it would merge with US rival Activision to form the world’s biggest video games giant in an $18.9 billion (12.9 billion euro) transaction.

The deal will combine the companies behind popular video games “World of Warcraft” and “Call of Duty.”In Frankfurt, meanwhile, market gains were driven by a rebounding financial sector.

Hypo Real Estate shares added 2.68 per cent to 37.20 euros and Commerzbank won 0.37 per cent to 27.20 euros.

Before the weekend, Wall Street had ended mixed Friday with the leading Dow Jones Industrial Average higher for a fourth straight trading day as investors set their sights on lower American interest rates.

The Dow Jones held its gains after a speech by Federal Reserve chairman Ben Bernanke late Thursday in which the central bank chief warned that strains in the financial markets may lead to broader economic problems.

Wall Street read that as meaning fresh US interest rate cuts were imminent.—AFP