European stocks dropped, paced by Royal Philips Electronics NV after profit at its liquid-crystal- display venture fell. Nokia Oyj declined ahead of its quarterly report this week, which may show shrinking profit. Oil shares including Shell Transport & Trading Co. rose, limiting benchmarks' declines, as crude reached a record high. Deutsche Telekom AG dropped as Germany's government will sell a 7 percent stake in Europe's biggest phone company.
The Dow Jones Stoxx 50 Index shed less than 0.1 percent to 2732.86 as of 11:31 a.m. in London. The Stoxx 600 slipped 0.1 percent, as about nine stocks fell for every five that gained. The Euro Stoxx 50 benchmark for the countries that use the euro also fell 0.1 percent. Philips shed 1.4 percent to 18.95 euros. The Dutch electronics company owns almost half of Korea-based LG.Philips, the No. 2 maker of liquid-crystal displays. LG.Philips said third- quarter net income fell a more-than-expected 15 percent after a glut of flat screens drove prices lower. Philips, Europe's third-largest chipmaker, is set to report profit tomorrow. Third-quarter earnings may have jumped to 1.11 billion euros ($1.37 billion), the highest quarterly profit since 2000, according to the median forecast of 11 analysts in a Bloomberg News survey. Nokia, the world's biggest mobile-phone maker, declined 1.5 percent to 11.21 euros. The Espoo, Finland-based company may say Oct. 14 third-quarter profit sank 29 percent to 585 million euros ($726 million), according to the median forecast of nine analysts surveyed by Bloomberg News.
Wolfson Microelectronics Plc, a maker of semiconductors for consumer electronics, tumbled 39 percent to a record 100.5 pence after the Edinburgh-based company reduced its full-year sales forecast on slowing demand. The Stoxx 600 Technology Index was the worst-performing of 18 groups in the broader benchmark.
Sainsbury, Oil
J Sainsbury Plc fell 0.8 percent to 250 pence. Britain's third-largest supermarket chain said first-half earnings fell by as much as two-thirds as the company lost customers to competitors including Tesco Plc and Wal-Mart Stores Inc.'s Asda. Shell Transport, which owns 40 percent of Royal Dutch/Shell Group, Europe's No. 2 oil company, added 0.5 percent to 423.25 pence. BP, Europe's largest oil producer, rose 0.3 percent to 553 pence. Total SA, the region's third-biggest oil company, climbed 0.4 percent to 169.1 euros. Crude oil rose as much as 0.1 percent to $53.42 a barrel in New York, a new intraday record, after a storm in the Gulf of Mexico disrupted supply and as Nigerian oil workers joined a general strike.
``We are big proponents on the energy cycle, and we think that there is still a lot of ride left in it,'' said Doug Sandler, equity strategist at Wachovia Securities Inc. in Richmond, Virginia.
Deutsche Telekom
The Stoxx 600 Oil & Gas Index was the best-performing group in the overall benchmark. Deutsche Telekom shed 0.8 percent to 15.10 euros as Germany's government will sell a stake in Europe's largest phone company worth as much as 4.45 billion euros ($5.5 billion). The sale of shares and warrants by KfW, a German state-owned development bank, accounts for about 7 percent of the phone company. Separately, Deutsche Telekom offered to buy out investors in its T-Online International AG Internet division for about 3 billion euros to revive growth at its fixed-line business. T- Online shares added 1.2 percent to 9.10 euros. The group of phone stocks was the second-biggest declining group on the Stoxx 600, falling 0.7 percent.
Barclays, Lloyds
Barclays Plc jumped 1.9 percent to 581 pence, while Lloyds TSB Group Plc advanced 1.5 percent to 453.25 pence. The two lenders were the biggest and third-biggest gainers in the Stoxx 50, respectively. Both U.K. banks jumped last week after a report in the Observer newspaper said Citigroup Inc. considered them potential takeover targets. A spokesman for the U.S. bank last week wouldn't comment.
Getinge, Business Objects
Getinge AB, the world's largest maker of surgical workstations, slid 5.8 percent to 81.75 Swedish kronor, the steepest decline on the Stoxx 600. The company forecast third- quarter pretax profit of about 190 million kronor ($26 million), lower than in the same period last year, as it returns to a more ``normal seasonal course of events.'' Business Objects SA, the world's largest maker of software to track corporate databases, dropped 4.1 percent to 18.79 euros. The software maker said shareholder New SAC may sell a 15 percent stake in the company, worth $340 million at Friday's closing price of 19.59 euros. Altran Technologies SA, Europe's largest provider of contract technology research, fell 4.2 percent to 5.95 euros. The company reported a first-half net loss of 14 million euros after deferred tax charges and integrating results from unprofitable units. ////www.bloomberg.com