Nokia, the world's biggest mobile phone maker, fell 1.2% to 16.55. SAP, the world's largest maker of businessmanagement software, also slid 1.2% to 147.17. Anglo American, the world's second-biggest mining company, and Mittal Steel, the world's largest steel-maker, retreated after China's central bank raised interest rates.

"What worries investors is that slowing economic growth may cut demand for commodities, " said Mario Menendez-Mato, director of Orient Finance in Paris. "It won't be the last interest rate increase for China."

Indexes retreated as the University of Michigan's preliminary index of US consumer sentiment dropped to 78.7 in August, down from 84.7 in July. "That proves the economy is slowing down, " said Ion-Marc Valahu, a fund manager with Agilis Gestion in Paris. "Company spending is going to have to pick up the slack from consumer spending, and that hasn't been the case."

The Dow Jones Stoxx 600 Index slid 0.3%, dropping for the first time in six sessions.

The Stoxx 50 also lost 0.3%, while the Euro Stoxx 50 slipped 0.2%. National indexes rose in 10 of the 18 western European market, but Germany's DAX fell 0.3% and France's CAC 40 by 0.2%.

The FTSE 100 added 0.1%.

The Stoxx 600 still climbed 2% last week, led by technology stocks, after US government reports on producer and consumer prices showed inflation is slowing, easing concern that the Fed will keep raising interest rates.

The Stoxx 50 advanced 1.8% in the week and the Euro Stoxx 50 is 3.2%higher.

One winner of the week was BAE Systems, Europe's biggest weapons maker, which rose by 2.6% on reports that the UK agreed to supply Saudi Arabia with 72 Eurofighter planes.

Eurofighter is a Munichbased joint venture between BAE, Finmeccanica and European Aeronautic, Defence & Space.

Provident Financial, the UK lender to low-income households, had its biggest gain in four years after a regulator proposed remedies to foster competition for doorto-door loans without imposing price restrictions. The stock surged 6.8% to 631p.

WPP Group, the world's second-biggest advertising company, was also on the up.

Chief executive Martin Sorrell said he is "more confident" that revenue growth this year will exceed the industry's 3% to 4% range, after the company reported a 31 percent gain in first-half profit. (Bloomberg)