Trichet's comments "put off an interest-rate increase and this is very good", said Vafa Ahmadi, a fund manager at CPR Asset Management in Paris.

"Merger-and-acquisition activity will continue. If companies consider share prices affordable, there's no reason for us to think the opposite."

Credit Agricole SA and Aegon NV paced gains by banks and insurers, among the most sensitive to changes in rates. Deutsche Boerse AG led exchanges higher, on expectations the industry will benefit from takeovers. Altadis SA rose to a record, amid speculation Imperial Tobacco Group Plcmay bid for the cigarette maker.

The Dow Jones Stoxx 600 Index added 1.7% this week, climbing to a six-year high.

The index advanced for a third week. The Stoxx 50 rose 1.3%, and the Euro Stoxx 50, a gauge for the 13 nations using the euro, climbed 1.1%. Air FranceKLM Group and Ciba Specialty Chemicals AG led airlines and chemical makers higher as oil prices fell to a 19-month low.

Energy companies were the worst-performing stocks.

National benchmarks rose in all 18 western European markets except Austria and Ireland.

Germany's DAX gained 1.7%, France's CAC 40 added 1.8% and the UK's FTSE increased 0.3%.

Policy makers kept the benchmark rate on hold at 3.5% on 11 January. The Bank of England the same day unexpectedly raised its key rate by a quarter point to 5.25%. The US Federal Reserve's target rate currently stands at 5.25%.

Not rushing rate increases is "the best way to sustain the economy", said Niccolo Pini, who helps manage the equivalent of $770m at Banca Ifigest SpA in Florence. "Low rates will sustain the economy and the equity rally."

Deutsche Boerse, the operator of the Frankfurt exchange, rose 6.3% on 11 January, finishing the week up 7.8%, amid speculation stock-market operators worldwide will benefit from further mergers and acquisitions and higher trading volumes. Deutsche Boerse spokesman Walter Allwicher declined to comment on the share price move.

"The sector in general is frenzied with merger talk, " said Mamoun Tazi, an analyst at Man Securities in London. Tazi has a "buy" recommendation on Deutsche Boerse's stock.

Euronext NV, Europe's second-biggest stock exchange, jumped 6.4%.

Air France, Europe's biggest airline, gained 2.3%.

Ryanair Holdings Plc climbed 2.8%. Ciba, the world's largest maker of colors for plastics, advanced 4.5%. Crude oil sank in New York on speculation mild weather in the US northeast will hurt demand and after an energy department report on 10 January showed US fuel stockpiles rose for a fourth week.

APPLE GETS JUICY Steve Jobs' unveiling of the previously mythical iPhone was met with thunderous applause at his MacWorld cult rally and made worldwide headlines. By Friday the knives were out as the antiApple contrarians and Cisco sought to remove the iPhone's shine.

FTSE 100 6,239 Down 0.30% on week Dow 12,548.63 Up 1.21% on week Nasdaq 2,497,10 Up 2.59% on week