Germany's DAX ended lower, after a better-than-expected Ifo reading failed to lift Frankfurt's main market. On the corporate news front, carmakers were the main focus. VW (-0.10%) confirmed its Golf SUV will be built in Wolfsburg after the German works council agreed to make production at the site more competitive. Meanwhile, Porsche (+9.64%) expects a double-digit return on its investment in VW, and will seek three positions on the auto giant's supervisory board. DaimlerChrysler's (+0.48%) 37%-owned Japanese partner Mitsubishi said US sales will rise in September on the back of its redesigned Eclipse car for the second month in a row, which follows two years of decline. Siemens (-1.01%) has found losses at a German unit of Austria's VA Tech - which it is buying for EUR 1 billion - so will have to make one-off provisions of some EUR 70 million. Tire maker Continental (-0.29%) is looking to lower costs further by buying more components in low-cost countries. Degussa (+0.55%) plans to invest up to EUR 150 million per year in China to reach revenues of EUR 900 million by 2008. The fine chemicals group aims to increase the workforce to 4,000 by 2008 from 1,400 now.
In the U.K., the FTSE suffered late pressure from weak trading on Wall Street and ended marginally lower. Broader local earnings updates called for caution: Mitchells & Butlers (+0.07%) said the July terrorist attacks were having a significant impact on its Central London estate, with same outlet sales growth in Central London at 2.2% vs 7.6% growth in the 40 weeks prior to the attacks. The shares were down for most of the session, only recovering in late trade. Pilkington (-2.43%) was lower after it said the market remains challenging. Emap (-1.89%) fell as first half revenues were up only 1%. On the merger & acquisition front, Compass (+1.97%) gained on reports Italy's Autogrill could be interested in buying the UK group's restaurant service operations.
In France, the CAC 40 (-0.44%) fell further at the close. Wall Street traded in the red after US data came in worse-than-expected, with September consumer confidence sliding to 86.6 vs 105.5 in August, the sharpest drop in the past 15 years. West Texas Intermediate futures traded at US$65.70 per lifting Total (+0.13%) despite a downgrade to hold from buy at JP Morgan. Arcelor (+0.8%) remained positive as Chinese Business News reported the European steel giant is interested in acquiring a 50% stake in China's Laiwu Steel. Meanwhile, Thales (-0.57%) remained negative as Le Monde reported accusations that the defense group bribed officials to secure contracts. LVMH (-0.58%) slipped after strong gains Monday on the strong US dollar. The luxury group is launching an internet selling service which can deliver products within two days in France. Foncia (+0.72%) stayed high as Citigroup lifted the target to EUR 30.8. Meanwhile, SR Teleperformance (+5.1%) rallied after posting first half attributable net profit up 54% and lifting its fiscal year 2005 guidance. APRR (-0.72%) reported its first profit up 49% to EUR 91.5 million after reducing its financial expenses. Small caps Beneteau (+2.29%) and Pinguely-Haulotte (+1.84%) will publish first half figures after the close today.
Japan's Nikkei 225 sank 82.59 points (0.62%) to 13,310.04. Tokyo shares came down on Tuesday on profit taking after the Nikkei 225 and TOPIX reached four-year highs yesterday.
In Hong Kong, the Hang Seng index closed lower although the broader market was mixed with advancing issues matching declining issues at 14 each. The Hang Seng finished modestly above its session low. Hong Kong has not kept up with gains in Japan and South Korea recently due in part to higher interest rates locally.
South Korea's KOPSI index closed up 0.27% at another all-time high of 1209.63, supported by optimism toward the domestic economy. Trading was somewhat volatile, with the KOSPI sinking to a session low in the afternoon and then rebounding in the final 45 minutes of the session. Banks such as Hana Bank (+4.19%) and Kookmin Bank (+0.32%) advanced on speculation that the central bank would raise interest rates. But tech giant Samsung Electronics slid 0.67% on profit taking following over a gain of over 2% on Monday.