LONDON, Dec 4: Europe’s main equity markets sank on Tuesday as investor concerns resurfaced over the global credit squeeze after a pullback earlier in Tokyo and overnight in New York, analysts said.

Worries over lack of credit market activity and banks lending to banks is behind today’s downturn, said Howard Wheeldon, strategist at BGC Partners. He added that “the credit market situation is getting worse” in London.

In late morning deals, the British capital’s FTSE 100 index of leading companies dived 1.15 per cent to 6,313.30 points.

In Paris the CAC 40 lost 0.95 per cent to 5,576.03 and Frankfurt’s DAX 30 shed 0.21 per cent to 7,821.11 points.

The DJ Euro Stoxx 50 index of top eurozone shares fell 0.64 per cent to 4,343.61 points.

The European single currency stood at $1.4711.

Wall Street shares had swung lower Monday as soft US economic data and sluggish auto sales reports prompted investors to lock in gains from last week’s strong rally.

In Europe, banking stocks were hit hard by lingering concerns over the ongoing credit crunch.

This year, the US subprime housing crisis has sparked a global credit squeeze as commercial banks have turned cautious about lending money to one another.

In London trading on Tuesday, shares in British bank Barclays fell 4.90 per cent to 533.5 pence, and Alliance & Leicester sank 4.78 per cent to 688 pence.

Troubled lender Northern Rock’s stock sank 5.96 per cent to 102.5 pence. Elsewhere, the metals sector was in focus.

German steel group ThyssenKrupp on Tuesday reported a record net profit for its 2006-2007 fiscal year, but chief executive Ekkehard Schulz indicated later that growth could slow considerably this year.

In US trade on Monday, the Dow Jones Industrial Average lost 0.43 per cent to close at 13,314.57 points, ending a four-session winning streak.

The Nasdaq composite fell 0.90 per cent to 2,637.13 and the Standard and Poor’s 500 broad-market index shed 0.57 per cent to 1,472.42 points.—AFP