German equities turned positive in late trading but all other leading European stock markets had another depressing session. The FTSE Eurobloc 100 index came off 0.3 per cent to 1,065.12 for a two-day decline of 1.6 per cent. The FTSE Eurotop 100 index lost 0.8 per cent at 2,918.25 and the FTSE Eurotop 300 index shed 0.7 per cent at 1,281.12.

Among sectors, mining was the day's heaviest casualty, slipping 3.3 per cent on profit-taking among gold shares. At the other end of the performance tables, construction staged a near 1 per cent rally.

Frankfurt reversed early losses, turning a morning deficit on the Xetra DAX index of almost 50 points into an improvement of 16.52 at 5,135.62 at the close. Deutsche Bank produced an early surge on hopes for an investment banking partnership with Societe Generale. The French bank successfully fended off a take-over bid from BNP earlier this year. The stock ended up 45 cents at €62.55 after a high for the session of €62.62.

Speculation about the disposal of non-core shareholdings sent Allianz ahead. The insurer has big stakes in a number of leading German groups, including 22 per cent of Dresdner Bank. The shares rose €3.86 to €267.50. Munich Re put on €3.78 at €192. Deutsche Telekom, which ran into steady selling on Tuesday on stock overhang concerns, managed to rally modestly, adding 30 cents at €38.30.

Paris dropped again with Canal Plus, the media company, leading the way down. The CAC-40 index ended 8.84 or 0.2 per cent lower at 4,535.08.

Canal Plus dropped €2.45 or 4.1 per cent to €57.75, continuing a fall triggered by disappointing results it released last week. Shares have come off 10.5 per cent in the past five sessions.

Vivendi, the conglomerate, lost 65 cents or 1 per cent to reach €66 after a meeting with fund managers that disappointed at least one participant. Renault shares leapt €2.05 or 4.2 per cent to €51.40.

Amsterdam saw support for financials in late trading and the AEX index ended off 0.75 at 554.21 after a low for the session of 547.55. Financial service leaders Aegon and ING added 45 cents at €80.05 and 35 cents at €50.35 respectively.

Heineken came off €1.10 at €47.50 in spite of an upbeat earnings forecast for this year from the brewer and an upgrade to buy at Deutsche Bank.