European shares ended yesterday off session highs as news of a investigation by the European Commission over possible state aid at BT Group hurt an otherwise strong telecoms sector.

Deutsche Telekom was among the region's top gainers, up one per cent on a report it may raise its 2006 dividend. Vodafone climbed 1.1 per cent on anticipation of positive news from an accounting update today and a trading statement next Wednesday.

Declines on Wall Street capped markets this side of the Atlantic after disappointing profit guidance from Motorola and uninspiring earnings from other companies snapped a two-day rally.

By 1645 GMT, the FTSEurofirst 300 index of Europe's top companies was up 0.14 per cent at 1,053.56 points as a fall in the price of oil was offset by a retreat of the dollar against the euro.

The narrower DJ Euro Stoxx 50 index nudged down 0.1 per cent to 2,959.90 points.

BT shares fell after the European Commission said it was investigating the British telecom service provider, as well as Kingston Communications, for potentially receiving illegal tax advantages from the British government.

Sign up to our free newsletters

Get the best updates straight to your inbox:
Please select at least one mailing list.

You can unsubscribe at any time by clicking the link in the footer of our emails. We use Mailchimp as our marketing platform. By subscribing, you acknowledge that your information will be transferred to Mailchimp for processing.