European telecommunications stocks slid this week as Deutsche Telekom AG announced plans to cut debt by selling bonds that can be converted into shares.
Energy stocks gained as a New York oil terminal burst into flames, pushing crude oil higher.
The Dow Jones Stoxx 50 Index added 0.3 percent for the week.
The Stoxx 600 Index rose 0.4 percent in the period, with all of its gain coming yesterday after a fire broke out at the Staten Island terminal, pushing BP Plc and Eni SpA shares higher.
Deutsche Telekom led Stoxx 50 declines as an 11 percent slide by Europe's largest phone company erased 6.5 billion euros (US$7 billion) from its market value. The German company said it plans to sell 2.3 billion euros of bonds that must be changed into equity in three years.
The market showed "Deutsche Telekom and other companies that might be interested in doing the same thing that it doesn't like it," Rolf Muller-Rehbehn, who manages about 9 billion euros at Deka Investment GmbH in Frankfurt, said Wednesday.
France Telecom SA tumbled 3.4 percent Friday amid speculation the company is planning to sell shares to reduce its 70 billion euros of debt. The stock fell 11.4 percent for the week.
"We deny these fantastical rumors," said Bruno Janet, a spokesman for France Telecom. "No decision has yet been taken" on the timing for a share sale. Last week, Chief Executive Officer Thierry Breton said he would proceed with a share sale "as soon as we can, but the market has to be ready."
Also pushing oil stocks higher this week was concern that war with Iraq would limit crude supplies, keeping prices near two-year highs. The fire at Exxon Mobil Corp.'s loading terminal lifted Brent crude oil 2.3 percent higher to US$32.28 a barrel.
BP, the region's second-largest oil company, advanced 6.6 percent. Eni, Italy's dominant oil producer, ended the week 3.1 percent higher.
Total Fina Elf SA rose 3.4 percent for the week. The company on Thursday said its fourth-quarter profit nearly doubled, partly because of higher oil prices.
"Oil stocks are one area where you can see the key fundamental is strong -- the oil price," said Richard Wiseman, who manages 5 billion euros as head of European stocks at Insight Investment Management Ltd. in London. He owns more oil shares than he would need to match their weightings in benchmark indexes.
Corus Group Plc, Europe's second-largest steelmaker, fell 30 percent, leading Stoxx 600 percentage declines. The drop was triggered after the Financial Times reported opposition from workers might lead the company to scrap plans to sell aluminum assets to Pechiney SA. Corus, which needs the sale to cut debt, denied the report.
ThyssenKrupp AG, Germany's largest steelmaker, and the British insurer Royal & Sun Alliance Insurance Group Plc were among companies to suffer from speculation about pension-plan shortfalls. ThyssenKrupp shed 2 percent yesterday as its credit rating was cut to below investment grade by Standard & Poor's, which cited concern about the cost of funding pension obligations.
Royal & Sun ended the week 9.1 percent lower after Morgan Stanley on Wednesday reduced its recommendation for the stock. The broker said the insurer may have an after-tax deficit in its own staff pension fund of ?990 million (US$1.56 billion) by the end of this year.
Capita Group Plc, which runs the payment system for London's new traffic toll, led gains on the Stoxx 600, soaring 21 percent for the week. The ?5 charge for motorists driving into the center of the UK capital was introduced by London Mayor Ken Livingstone on Monday.
Gallaher Group Plc, the maker of Silk Cut cigarettes, jumped 6.9 percent Friday, for an 11 percent gain this week, on speculation British American Tobacco Plc may want to acquire its smaller rival. British American Tobacco is the world's second- largest tobacco company.
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