By Anna Peltola
STOCKHOLM, July 22 (Reuters) - Nordic stock markets opened in a gloomy mood on Monday, dampened by weaker overseas bourses and extending losses seen on Friday when telecoms group Ericsson lost almost a fifth of its value.
Drugs group Novo Nordisk plunged to lows last seen two and a half years ago after the company said it would suspend development of its insulin sensitiser NN622, seen by analysts as a potential sales growth driver.
Industrial group Norsk Hydro slipped in line with the market as the firm reported a bigger-than-expected profit for the second quarter, helped by a firm Norwegian crown, but said demanding market conditions hit operating profit.
The Stoxx Nordic index , which has now lost some 14 percent since September 11, slid 3.2 percent to new lows, and performed slightly weaker than the Eurotop-300 index.
Turnover remained thin with many market players on summer holidays and investors sidelined licking their wounds.
"There's nothing new under the sun. The market is still on its way down, and I think it will continue to slide until something new happens," said one broker in Sweden.
He said Stockholm's blue-chip OMX indec , now trading at 535 points, could well fall to 500 before a bounce, while Ericsson, now at 11.50 crowns, could find support at 10 crowns.
"Due to psychological reasons it could be 10 crowns. I can't see any other important support level, it's been so long since it's traded at these levels," the broker said.
Beside techs all other sectors, too, declined.
"The general rottenness in the market is not only touching technology firms but also others," a broker said. "Trust is lacking in the U.S. market for understandable reasons and people there want to get out of the stock market."
Telecoms group Nokia shed 3.5 percent, while rival Ericsson lost 3.4 percent, extending losses of 18 percent seen on Friday when the firm posted a Q2 loss in line with expectations but was hit by its downgrade of forecasts, weak order inflow and the terms of its rights issue.
Ericsson's stock still remained above the eight-year low of 10.90 crowns the stock briefly touched on Friday.
UBS Warburg cut its target price for Ericsson to 11 crowns from 16, but kept its "hold" rating for the stock.
NOVO PLUNGES
In Copenhagen, Novo Nordisk tumbled 19.6 percent. The firm said development of an insulin sensitiser would remain on hold until it had completed a renewed assessment of the benefits and risks associated with the product. Urine bladder tumours had been found in one mouse used in testing, the company said.
"We have for patient safety reasons decided to take a precautionary approach and stop the ongoing clinical trials while we investigate the new preclinical findings in more detail," Chief Science Officer Mads Thomsen said in a statement.
Norsk Hydro, whose core business areas are energy, metals and agriculture, shed 2.1 percent.
The firm reported profits before taxes of 7.06 billion Norwegian crowns ($955.1 million) for the three months to end-June, up from 5.74 billion in the year-earlier period.
But operating profits fell to 5.08 billion crowns from 6.07 billion. A Reuters poll of 10 analysts had pointed on average to profits before taxes of 6.62 billion crowns and an operating profit of 5.24 billion.
In forestry, the world's biggest paper and board maker Stora Enso , which reports interim results on Wednesday, eased 1.5 percent to 11.77 euros, off a year-low of 11.65 touched earlier.
Stora Enso and peer UPM-Kymmene have been hit hard by the appreciation of the euro versus the dollar, which has hurt euro-zone exporters.
Brokers say forestry stocks are set to fall whatever the companies' results, considering their strong performance in the past year when techs have tumbled.