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European shares fall as Huawei arrest fuels fresh trade worries; Ericsson up

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European shares fall as Huawei arrest fuels fresh trade worries; Ericsson up

European shares fall as Huawei arrest fuels fresh trade worries; Ericsson up
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STAFF(Reuters)
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MILAN (Reuters) - European shares fell sharply on Thursday after the arrest of a Huawei [HWT.UL] top executive fed worries over a fresh build-up in the Sino-U.S. trade war, hitting export-oriented tech and auto stocks.

Ericsson <ERICb.ST> and Nokia <NOKIA.PA> however outperformed, both trading up slightly in early deals, as the arrest the Chinese tech giant's CFO piled up pressure on their biggest rival and 5G powerhouse.

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By 0817 GMT, the pan-regional STOXX 600 <.STOXX> index fell 1.2 percent, marching towards the lowest level since December 2016 it hit during the sell-off seen over the last two months.

The export oriented DAX <.GDAX> index, which has also a big exposure to China and has been hit recently by concerns over a slowdown in the world's No.2 economy, fell 1.5 percent.

Auto stocks <.SXAP> were the biggest sectoral fallers, down 2.7 percent at their lowest in more than 2 years, led by a 3.4 percent drop in German carmaker Daimler <DAIGn.DE>.

Tech <.SX8P> was also heavily sold off as declines in chipmakers offset gains in Ericsson. Huawei supplier STMicro <.STMicro> fell 4.2 percent.

Elsewhere, Diasorin <DIAS.MI> was the biggest faller on the STOXX 600, down 7 percent after Kepler Cheuvreux downgraded the Italian biotech company to hold from buy.

(Reporting by Danilo Masoni; Editing by Josephine Mason)

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