European Midday Update: Markets Slightly Lower in Early Trading - TheStreet

LONDON -- Investors clearly felt this week's gains had gone far enough, as the market fell in line with most European exchanges by moving slightly lower this morning. The FTSE 100 was down 17 points, or 0.27%, at 6,396 in midmorning trading, and the Techmark index of leading technology shares dipped 0.76%, falling 26 points to 3,434.

There is a keen sharewatch on

EMI

(EMIPY)

this morning as investors monitor the stock's reaction to rumors that the $20 billion merger with U.S. monolith

Warner Music

may be trumped by a rival bidder. No new approach is yet official, but shareholders asked for a delay in the vote on the Warner merger Thursday after rumors of a potential second bidder emerged. The stock jumped violently Thursday, improving nearly 5%, or 31.5p, to stand at 690 by market close. Today's performance thus far has been far less dramatic, with the stock adding just 1.5p to 660 ($9.99).

There are also global rumors running rife in the telecoms sector. There are whispers that Finnish telco Sonera could be on the market with

Vodafone AirTouch

(VOD) - Get Report

thought to be a potential bidder. Vodafone dropped 7p to 301.5.

British Telecom

(BTY)

, however, was up 3p at 903.

BAE Systems

(BAESY)

was up 10p, 2.4%, to 427.5 in early trading after the company announced that it had reached an agreement with the three members of the newly formed European Aeronautics Defence and Space Company (EADS) to bring Airbus under the EADS umbrella. The deal will enable BAE to keep its 20% stake and have a say in strategic decisions alongside EADS constituent members

Aerospatiale Matra

,

DaimlerChrysler Aerospace

and Spain's

Casa

. In the European markets all three members of EADS have edged higher this morning too.

Shares in household goods giant

Unilever

(UL) - Get Report

dropped after what one analyst described as "nerves and jitters" over the company's second-quarter results --which are not due out until August. The shares fell 4.5%, or 20.75p to stand at 433.25.

Shareholders in another heavyweight household name,

Diageo

(DEO) - Get Report

, saw only a modest midmorning gain of 4.5p to 591.5 on the news that the company intends to float its

Burger King

fast food chains on the

New York Stock Exchange

.

Europe's other major stock markets were lower early Friday, with the

Xetra Dax

in Frankfurt down 19.8 at 7,033.9 and the

CAC 40

in Paris down 35.5 at 6,439.3. The Neuer Markt's tech-heavy

Nemax 50

index was off 151.7 at 6,227.3.

German blue-chip tech shares were weak, with software maker

SAP

(SAP) - Get Report

down 1.20 euros at 632.80 ($592.92),

Siemens

(SMWAY)

off 0.20 euros at 158.10, and

Epcos

(EPC) - Get Report

2.00 euros lower at 125.00.

DaimlerChrysler

(DCX)

rose 0.54 euros to 55.89 after a report by the

Financial Times

said the company was taking a 10% stake in Korean carmaker

Hyundai

.

Volkswagen

(VLKAY)

was up 0.27 euros to 39.80.

In Paris, food group

Danone

(DA)

fell 0.50 euros to 133.20 and telecoms equipment maker

Alcatel

(ALA)

dropped 1.65 euros to 70.85.

Major European telcos were lower Friday, with

Telefonica

(TEF) - Get Report

down 0.34 euros at 20.80,

France Telecom

(FTE)

off 0.70 euros at 156.30 and

Deutsche Telekom

(DT) - Get Report

0.54 euros lower at 63.55.