DaimlerChrysler, HSBC, BMW and cruise line Carnival paced a retreat by companies that generate a large portion of their sales in the US.

"Markets always get caught short by currency movements, " said one fund manager at New Star Asset Management in London. Dollar weakness has "obviously had an effect, " he said, "but it's made worse because we are now at the end of a pretty good year and people want to lock in some gains."

The Dow Jones Stoxx 600 index lost 1.9% to 349.31 last week. That was its biggest weekly retreat since 14 July. The Stoxx 50 declined 2.3% while the Euro Stoxx 50, a gauge for the 12 nations using the euro, fell 2.9%.

A November rally that sent the Stoxx 600 to its highest in almost six years stalled on concern that slowing US growth and a falling dollar would hurt pro"ts. The dollar slid to $1.3348 against the euro, its weakest since March 2005, as traders bet that the Federal Reserve would lower interest rates next year as the economy slows. Against the pound, the dollar tumbled to $1.9848, its lowest since September 1992.

"Dollar weakness is likely to hang heavy over European markets until the end of the year, " said one senior trader.

DaimlerChrysler, the world's "fth-largest carmaker, fell 4.7% on the week. The company generated 45% of its revenue from the US in 2005.

HSBC, Europe's biggest bank by market value, slipped 4%.

North America accounted for 35% of its revenue in 2005.

Carnival, the world's largest cruise operator, declined 7.3%. It generated 58% of its revenue from the US in 2005.

BMW, the world's largest maker of luxury cars, slid 3.8%.

The company made a quarter of its total sales in North America last year.

Wilson Bowden surged 20% last week. The UK homebuilder which is up for sale said cofounder and chairman David Wilson postponed his retirement date after several potential buyers made approaches. Wilson indicated on 14 July that he might sell his family's 33% stake in the company. Last Sunday, the company said it was in negotiations with a "number of parties" about a possible takeover offer.

EMI Group advanced 7.9%.

The world's third-largest music company had its share recommendation raised to "equalweight" from "underweight" by analysts at Lehman Brothers after it received a takeover approach.

The approach suggests there is "con"dence" that a merger with Warner Music may be allowed, which may justify prices higher than 360p ( 5.40), Lehman Brothers said in a note to investors.

Shares of Hellenic Telecommunications, Greece's biggest telephone company, climbed 9.1%. The company reported on Thursday a third-quarter pro"t that beat analysts' estimates as it cut "xedline jobs.

Fraport dropped 8.1% on the week. The airport operator agreed to pay Celanese Corp's German unit 650m to relocate the chemical maker's factory near Frankfurt airport in a move that would delay a planned fourth runway by a year.