European shares remained weak yesterday afternoon led by financials and technology stocks, though a rise in US unemployment was less than feared.

The jobs data will be scrutinised by the Federal Reserve when it meets to discuss US monetary policy next Wednesday with many investors still betting on a cut.

"On balance the Fed has already probably seen enough to cut rates, but this data has pulled back the probability of a cut as early as next week to maybe 50:5O," said Matthew Wickens, global economist at ABN AMRO bank.

Attention now turns to the US Institute for Supply Management's (ISM) manufacturing index for October, scheduled for 1500 GMT, which is expected to show a contraction for the second month in a row.

A weak ISM would increase yet more the chances of a Fed easing, Wickens added.

By 1343 GMT, the FTSE Eurotop 300 index was off 2.1 per cent at 880 points.

US stock index futures, down about one per cent ahead of the employment data, briefly cut their losses after the data before moving back down to prior levels.

The DJ Euro Stoxx 50 index shed 2.5 per cent to 2,454 points. Dutch financial group ING tumbled 6.7 per cent to E15.75 euros after investment bank JP Morgan recommended that investors switch out of the stock and into Dutch insurer Aegon, though its stock sank also.

Tech shares were also under the gun, with French telecom equipment maker Alcatel dropping six per cent to 4.72 euros after a downgrade.

Among the day's other standouts, Britain's second-biggest insurer, Royal & Sun Alliance plunged 12 per cent to 101.56 pence after announcing that an engineering firm was suing it over asbestos claims.

Royal & Sun's balance sheet is already shot as it needs to raise $1.17 billion to help revive earnings.

US non-farm payrolls fell by 5,000 in October compared with an upwardly revised 13,000 fall in September, while the unemployment rate edged up to 5.7 per cent.

Economists had forecast that non-farm payrolls would rise 7,000 in October after a decline of 43,000 in September, with unemployment rising to 5.8 per cent from 5.6 per cent.