European shares slide after Wall Street slump

LONDON (AFP) - Europe's main stock markets slumped on Thursday after US stocks had tumbled overnight on worries about the weak US housing market and its affects on the wider economy, analysts said.

The weakness in stocks "was largely attributable to fears that the already embattled US mortgage issuer market was showing even greater cracks as the housing market continues to deteriorate," said strategists at Deutsche Bank, quoted by Dow Jones Newswires.

London's FTSE 100 index of top shares percent was down 1.52 percent in value at 5,445.50 points in late morning deals.

Nearing the half-way stage, Frankfurt's DAX 30 index fell 0.90 percent to 6,329.18 points and the Paris CAC 40 index shed 1.91 percent to 4,256.57.

The Euro Stoxx 50 index of top eurozone shares decreased by 1.21 percent to 3,302.15 points.

The euro fell to 1.5703 dollars.

US stocks had tumbled heavily on Wednesday as investors also fretted over the health of corporate America as major companies began reporting their second quarter earnings amid economic uncertainty.

The share slide swept Wall Street, dragging down financial, technology and aviation stocks amid a broad selloff.

Japanese share prices closed slightly higher on Thursday, but worries over US corporate earnings lingered, dealers said.

In London on Thursday, investors were awaiting the Bank of England's latest interest rate decision due at 1100 GMT.

The BoE was widely expected to hold its key short-term interest rate steady at 5.0 percent following a two-day meeting held amid financial turbulence around the globe.

Britain, like most countries, is struggling to overcome rising inflation and slumping economic growth caused by high commodity prices and the credit crunch.

Oil prices steadied on Thursday as Anglo-Dutch energy giant Shell said it would resume full deliveries from a facility in Nigeria, and amid tensions over Iran, traders said.

Prices have soared since breaking through 100 dollars at the start of the year, but are down about 10 dollars from record peaks near 147 dollars last week.

In European stock market trading on Thursday, shares in French retailing giant Carrefour fell 10.22 percent on news that sales at its French hypermarkets fell 2.4 percent in the second quarter.

Shares in Carrefour, the world's second-biggest retailer, were being traded at 30.93 euros on a generally weaker Paris market.