Shares in Paris spent the day in the red, with the market largely preoccupied with the state's plans for the issue of the latest round of mobile phone licences. The French government said it would spell out how the licences are to be issued later this month.
Telecoms were by far the most heavily traded shares. France Telecom fell 1.7 per cent to €164.20, while construction and telecom company Bouygues was down 2.7 per cent to €715. But Vivendi, which has an interest in the bidding via its Cegetel subsidiary, rose 0.9 per cent to €119.20.
There was evidence of old economy stocks coming back into favour. Food-maker Danone had another good day, rising 4.3 per cent to €135.50 on continuing speculation about a mutual bid, with Cadbury-Schweppes, for Nabisco.
Aluminium and packaging group Pechiney rose after broker SG Securities upgraded it from "under-perform" to "buy" and set a price target of €55. However, by the close, the company was just 0.6
per cent higher at €44.07. The CAC-40 index ended the session off 66.49, or 1 per cent, at 6,589.77.
The FTSE Eurobloc 100 came off 1.1 per cent at 1,810.06 and the FTSE Eurotop 100 was down 0.8 per cent at 3,813.44. The FTSE Eurotop 300 shed 0.7 per cent at 1,624.32.
Frankfurt continued to move lower in dull volumes. The Xetra DAX index was off 85.88 at 7,322.14 at 5.30 p.m. German time.
Allianz fell steeply amid stock overhang concerns as Deutsche Bank announced plans to run down its 7 per cent stake in the insurer. A shade over 2 per cent of Allianz went through the market, forcing the stock down to €364.62 in morning trade. The shares were off €10.90 at €374 at 5.30 p.m.
Amsterdam brushed aside steep gains for KLM and media group Elsevier to send the AEX index down 3.96 to 668.70.
The alliance rumours that had wafted gently round KLM on Monday took a firm grip on investors' imaginations to push the stock up 6.7 per cent in 14.1 million shares traded.
An upbeat trading report, laced with a dash of Internet optimism, pushed Elsevier sharply higher. The stock jumped to €28.60 before closing €1.75 ahead at €27.75.
Madrid fell 2 per cent, pulled down for a second day by power stocks following expected government moves to cut electricity prices. The Ibex 35 index lost 221 to 10,782.5.
