What should have been Renault's big day turned into something of a nightmare for the French motor giant. Nissan, the group's key Japanese associate, did indeed wheel out bumper earnings, climbing out of the previous year's nasty black hole with a one billion yen turnaround. This was precisely what sector analysts had been hoping to hear. However, a grim statement about overall operating margins from Renault itself totally spoilt the party.

Hitting a self-imposed target of getting operating profits up to 4 per cent of sales this year was "going to be tight" against a background of slipping market share and tough trading in general, said Renault. The shares came off 4.3 per cent at #58 as Paris broker Cheuvreux downgraded the stock from "outperform" to "underperform". Arch-rival Peugeot, which released an upbeat trading statement on Tuesday, appeared to benefit from sector switching, gaining 4 per cent to #337. Paper shares hit fresh highs for the third session in a row and steel shares were equally in demand as investors' appetite for leading cyclicals showed no signs of abating.

Usinor rose 5.4 per cent to #16.10 and Thyssen Krupp 3.9 per cent to #18.20. Paper leaders Stora Enso and UPM-Kymmene gained 5.7 per cent to #13.85 and 4.2 per cent to #37.90 respectively.

Lufthansa and KLM found themselves at opposing ends of the runway after trading statements from the two airlines. Hit by a series of pilots' strikes, Lufthansa was able to reassure with a forecast that profits this year would match 2000. It was the absence of merger or alliance news that piqued investors in KLM. Lufthansa added 3.4 per cent at #22.65 and KLM came off 1.1 per cent at #21.60.

Sodexho suffered a disappointing trading statement and news of a potential rights issue sent catering group Sodexhoed Alliance steeply lower. The stock fell 6.7 per cent to #52.40 after a low for the session of #51. Italian agro-energy group Montedison, at the centre of a battle for control, put on 4.5 per cent to #3.29 as Electricite de France, the state-owned power giant, emerged as a shareholder with a near 4 per cent stake.