UPDATE 4-Nokia sees cellphone, gear market falling in 2009

* Sees 20 mln fewer sector sales in 2008 than forecast

* Global cellphone market to fall in 2009

* Global telecom equipment market seen down in 2009

* Economic slowdown, currency volatility hurting

* Shares fall to levels last seen in mid-2004 (Adds details, quote, updates shares)

By Tarmo Virki and Sakari Suoninen

HELSINKI, Nov 14 (Reuters) - Top handset maker Nokia Oyj (NOK1V.HE) said on Friday the world's mobile phone market would fall in the fourth quarter and next year as an economic slowdown crimps consumer demand around the world.

It forecast 1.24 billion phones would be sold worldwide this year, down from a previous estimate of 1.26 billion, and said handset market volumes and the overall telecommunications equipment market was expected to fall next year.

"The warning dovetails well with Qualcomm (QCOM.O) and Intel (INTC.O) -- rapid recent deterioration of consumer electronics demand," said analyst Tero Kuittinen at Global Crown Capital.

The worst financial crisis in 80 years has weakened economies around the world and official data on Friday showed the economy of the 15-nation euro zone shrank for the second quarter in a row. [ID:nLE536930]

"In the last few weeks, the global economic slowdown, combined with unprecedented currency volatility, has resulted in a sharp pull back in global consumer spending," Nokia said in a statement.

The strengthening U.S. dollar and yen are pushing up component prices for handset manufacturers, while weakening currencies in emerging markets are hurting the purchasing power of consumers in Nokia's key markets.

"Developed markets will fare worse and developing markets will fare better," Nokia Chief Financial Officer Rick Simonson told an investor call.

Nokia said the increasingly limited availability of credit was also hurting, something analysts agreed with.

"We have been hearing about operators and distributors reducing their handset stock to an absolute minimum due to a credit shortage for the past few weeks," said analyst Neil Mawston of Strategy Analytics.

Nokia shares fell more than 7 percent to 9.56 euros on Thursday, their lowest since August 2004, but later recovered and closed down 3.7 percent at 9.95 euros in Helsinki. In New York, Nokia's ADRs closed 11.02 percent lower at $12.59.