Alstom, the French engineering and transport company, fell to its lowest level for almost three years following the collapse of Renaissance Cruises of the US earlier this week. The share price went down almost 27 per cent to €18.61.

Its peer ABB, the Swiss-Swedish engineering group that has lost almost three quarters of its value this year, had its earnings per share forecasts cut by Merrill Lynch. The the shares ended unchanged at €11.20.

German utility group RWE continued climbing strongly a day after releasing full-year results showing a 41 per cent rise in operating profit. Yesterday in late trade the shares had gained 7.4 per cent to €44.20. Its larger rival Eon was up 3.8 per cent at €56.95. In Spain, Iberdrola was up 3.6 per cent at €14.30.

Pirelli, the Italian tyre and cables group, which since July has controlled Telecom Italia and its parent Olivetti, yesterday unveiled plans to sell €6 billion in assets and raise €4 billion via a capital increase. Investors will have the choice of convertible bonds or additional equity. The market received the details favourably, with Telecom Italia up 2.8 per cent to 7.88 and Olivetti up 3.5 per cent to 0.98. Pirelli fell 1 per cent to 1.47.

Techs and telecommunications retreated as investors pocketed some gains from recent rises. Philips fell 5 per cent to €19.50. Nokia lost 8.2 per cent to €16.75. In late trade, Infineon continued its slide, falling 1.2 per cent to €12.07.

Pharmaceuticals firm Novartis put on 2.6 per cent to SFr62.10, while Roche was 3 per cent higher at SFr112.25.

Shares in Danish drug maker Lundbeck dropped 2.3 per cent to DKr172.

Spanish biotechnology group Zeltia put on 9.6 per cent to €8.44 on market rumours of a bid from Johnson & Johnson at a price of €16 a share.