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THE TELECOMMUNICATIONS sector was shaken yesterday by news that ATT will buy T-Mobile USA, while elsewhere on Wall Street sentiment improved as concerns over Japan’s nuclear crisis eased.

ATT announced on Sunday that it was buying T-Mobile from Deutsche Telekom for $39 billion in a deal that will create the largest wireless carrier in the US. Shares in ATT were up 1.2 per cent to $28.26.

The telecoms sector as a whole had a mixed reaction to the news. Verizon Communications, the second-largest US telecoms group by revenues, rose 1.7 per cent to $36.46 but Qwest Communications International fell 3.4 per cent to $6.69.

The improving situation in Japan lifted some insurance stocks as worries eased somewhat over the extent of their liabilities.

Hartford Financial Services was up 3.9 per cent to $26.49 while American International added 6 per cent to $37.03.

Semiconductor stocks also gained as fears over supply constraints resulting from the Japan disaster receded. “Our most recent checks suggest the supply worst-case scenario likely has been averted,” wrote analysts at Citigroup.

Applied Materials was up 2.5 per cent to $15.21 while Cirrus Logic added 4.9 per cent to $20.95.

Qualcomm, the world’s largest producer of mobile-phone chips, rose 3.7 per cent to $53.63.

The industrial sector rallied from its 1.7 per cent loss last week as Japanese tensions eased.

General Electric, which helped supply the reactors to the earthquake-stricken Fukushima nuclear plant, added 2.4 per cent to $19.72 while 3M put on 2.2 per cent to $90.95.

Schlumberger, an oilfield services company, was up 4.4 per cent to $89.72 while Marathon Oil added 4.4 per cent to $51.84. The wider markets appeared unperturbed by the rise in energy prices.

Elsewhere on Wall Street, Tiffany gained 5.1 per cent to $60.22 after reporting fourth-quarter profits up 29 per cent, beating market expectations.

The jewellery group, which gets 18 per cent of its revenue from Japan, fell 9.3 per cent last week following the disaster. – (Copyright The Financial Times Limited 2011)