FRANKFURT (AFX) - Shares were lower in midday trade following losses on Wall Street overnight and across Asia this morning and as stock futures pointed to further declines in the US this afternoon, with Munich Re extending yesterday's sharp fall after JP Morgan downgraded the stock, dealers said.

Munich slid 1.55 to 113.45, as JP Morgan downgraded its stance on the issue to 'neutral' from 'overweight', citing limited upside potential for the stock, which is now trading at levels near its 115 eur price target.

Auto stocks were weak too, as the euro strengthened against the dollar, with DaimlerChrysler losing 0.33 to 42.66, Volkswagen easing 0.34 to 46.24, and BMW slipping 0.20 to 37.23.

Bayer was down 0.30 at 33.75, as a hiked sales peak potential guidance for three of its major drugs failed to push the stock higher in a weak market, following the shares' recent solid performance.

One dealer said that while the news was positive, there was unlikely to be any major share price reaction as the stock has staged a solid performance recently, rising some 23 pct since the end of October.

Bucking the trend, Adidas-Salomon rose 3.03 eur or 1.99 pct to 155.53, after the German sports goods manufacturer told Financial Times Deutschland it has already reached the sales target for its licensed 2006 football World Cup products.

On the MDAX, KartstadtQuelle was the main focus, soaring 1.00 eur or 9.57 pct to 11.45, as investors welcomed news on restructuring measures and the retailer's future strategy, which includes a complete or partial sale or an IPO of its real estate assets.

KarstadtQuelle said it may divest its real estate assets as part of a series of restructuring and refinancing moves that will enable it to pay down its debts by 1 bln eur to less than 2.8 bln eur by end-2005.

Over on the TecDAX, Rofin Sinar fell 0.70 eur or 1.82 pct to 37.66, while MorphoSys soared 2.31 eur or 6.50 pct to 37.86, after the German biotech company said it is raising its full-year net profit guidance to 3.5 mln eur from 2.0 mln earlier, and its sales target to 31.5 mln eur from 30 mln.

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