European equities bounced off seven-week lows but ended slightly lower yesterday as Intel's disappointing outlook weighed on sentiment, while Britain's Vodafone lent support.

Investors remained wary ahead of results from Finnish mobile phone maker Nokia due today.

California-based Intel, the world's top chipmaker, cut its profit margin forecasts late on Tuesday and said inventories rose, even though it reported a near doubling of profit.

The FTSE Eurotop 300 index closed 0.2 per cent lower at 980 points, after falling to 970.7 points earlier in the session, its lowest level since May 25.

Beaten-down tech stocks cut some losses after a small rise on Wall Street.

Philips Electronics fell 1.7 per cent to €20.9 but climbed from the day's low of €20.6.

Deutsche Bank cut its target price on the stock to €25 from 28.5, saying that guidance from the Dutch group pointed to some degree of inventory correction in its chip division.

Phone operator Vodafone was a standout gainer and its shares rose 2.1 per cent to 120 pence amid talk the UK-based group was likely to report encouraging subscriber numbers in less than two weeks.

The DJ Euro Stoxx 50 index was off 0.3 per cent at 2h,755 points.

Good news from Dutch chip equipment maker ASML failed to help the stock break out from a sectoral fall as the cautious overnight comments from Intel hit market sentiment.

ASML reported stronger-than expected quarterly profit and said it expected strong demand going into next year, contrasting with mounting concerns of a slowdown in the semiconductor sector.