Franfurt DAX: 3,812.45 (-41.62)

The Frankfurt stock market suffered a substantial loss, pulled back by the weakness of the Hong Kong market and of the dollar which overcame the positive influence of Wall Street's rise on Monday, according to traders. The DAX fell 1.08 per cent on the day.

Traders said the Hong Kong bourse's 4.2 per cent plunge on Tuesday annihilated the favourable sentiment created by Wall Street's 3.12 per cent surge on Monday.

Paris CAC-40: 2,777.02 (-10.94)

In Paris, the Bourse closed 0.39 per cent lower against the background of the fall in Hong Kong and with the truckers' dispute and Iraq-US tension undermining sentiment. "The market is still selective, volatile and nervous; the dollar is our only guide," one dealer commented.

Milan Mibtel: 14,996 (-93)

Italian shares fell, tracking a volatile Dow Jones, while investors decided it was a good time to take out Monday's profits.