(AFP) – Aug 4, 2008

LONDON (AFP) — Europe's main stock markets slid on Monday when investor sentiment was sapped by news of a 29-percent slump in first-half profits by global banking giant HSBC, analysts said.

Nearing midday trade in London, the FTSE 100 index of top companies stood at 5,352.80 points, a drop of 0.04 percent from Friday's close.

Frankfurt's DAX 30 slid 0.74 percent to 6,349.20 points and in Paris, the CAC 40 lost 0.18 percent to 4,306.69 nearing the half-way mark.

The Euro Stoxx 50 index of leading eurozone shares weakened by 0.44 percent in value to stand at 3,301.86 points.

The European single currency was at 1.5578 dollars.

Wall Street ended lower on Friday as a government survey showed employers slashed 51,000 jobs in July and as auto giant General Motors reported a worse-than-expected 15.5 billion dollar quarterly loss.

Japanese share prices closed sharply down on Monday, ending below the key 13,000 points level.

The European banking sector took a knock after HSBC announced that profits sank during the first half because of ballooning credit writedowns and bad consumer debts.

In response, HSBC's share price dived 2.39 percent to 817 pence.

HSBC, Europe's biggest bank by stock market value, warned that the outlook remained "highly challenging" as it reported profit after tax totalling 7.72 billion dollars (5.0 billion euros) in the six months to June 30.

That compared with net profit of 10.90 billion dollars in the same period of 2007.

Loan-impairment, or bad-debt, charges and other credit-risk provisions surged by 58 percent to 10.06 billion dollars in the first half, HSBC added in a results statement.

In Amsterdam, shares in Belgian-Dutch bank and insurance group Fortis plunged 2.80 percent to 9.04 euros.

Fortis reported on Monday a halving of its second-quarter net profits owing to the credit market crisis.

The company posted net profit of 830 million euros (1.3 billion dollars) in the second quarter, down from 1.616 billion euros in the corresponding period of 2007.

In Frankfurt, Deutsche Bank shares fell 1.67 percent to 57.78 euros as investors continued to digest last week's news of a 63.0-percent slump in second-quarter net profits.

Across the Atlantic on Friday, the Dow Jones Industrial Average had fallen 0.45 percent to close at 11,326.32 points.

Traders said that a fresh jump in world oil prices, tied to renewed geopolitical angst over Iran's nuclear program, also hobbled Wall Street.

In Asia on Monday, Tokyo's benchmark Nikkei-225 index slid 1.3 percent to 12,933.18 points, which was the lowest close since July 18. Hong Kong's key Hang Seng index shed 1.5 percent to 22,514.92.

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