A failed bank merger and a number of weak trading updates pushed shares in Frankfurt lower.

Banks had an unhappy session after Dresdner Bank and Commerzbank pulled out of merger plans. Commerzbank lost 36 cents at €37.13 after touching a low for the session of €36.66 while Dresdner fell 94 cents to €46.76 after €44.82.

Allianz, the big insurer which owns more than 21 per cent of Dresdner, shed €8.19 at €407.37. Deutsche Bank, which failed to link up with Dresdner Bank earlier in the year, came off €2.79 at €96.97.

Siemens fell €7.50 to €170.50 after a warning of slower final-quarter results took the shine off strong third-quarter earnings. DaimlerChrysler, which pointed to lower full-year operating earnings, fell to €54.86 before recovering to €57.15, up 95 cents.

At 5.30 p.m. German time, the Xetra DAX index was down 70.97 at 7,258.07.

Paris made modest gains in spite of a downward pull from the Nasdaq. The CAC-40 rose 0.5 per cent to 6,493.

There were no outstanding gainers or losers among the blue chips. Societe Generale was the only CAC stock to see some action, rising 3.75 per cent to €65.05, lifted by speculation it might be approached by Dresdner Bank or Commerzbank after the collapse of their merger talks.

Canal Plus rose 0.5 per cent to €178.60 as France's broadcasting regulator demanded the company should retain direct control over its subscriber list as a condition of the Vivendi-Seagram-Canal Plus merger going ahead.

Michelin fell 0.4 per cent to €37.25 after it warned that it might not meet its operating margin target of 9.5 per cent for 2000.

Aer France shares recouped some of their losses, rising 1 per cent to €19.50, following the crash of one of its Concordes.

Amsterdam finished lower in a session of narrow trading for top blue chips. The AEX index closed off 2.69 at 680.46.