Shares of healthcare companies dragged benchmark indices lower, led by GlaxoSmithKline after the drug maker's top-selling diabetes treatment was found to raise a patient's chances of a heart attack.

The Stoxx 600 reached its highest since September 2000 on Wednesday and then retreated later in the week after former US Federal Reserve chairman Alan Greenspan said shares in China could face a "dramatic correction".

"The market has just moved around on comments from an excentral banker and there is very little else out there to drive market direction, " said Kevin Lilley, a fund manager with Royal London Asset Management. "You have got M&A pushing stocks higher on the positive side, and then you have Greenspan's comments."

National benchmarks rose in 10 of the 18 western European markets. Germany's DAX added 1.7%, and France's CAC 40 lost 0.7%. The UK's FTSE 100 declined 1.1%.

Shares of France Telecom, Europe's number three phone company, climbed 2.2% to 22.42.

Deutsche Telekom, the biggest in the region, jumped 6.7% to 13.41, the steepest climb in the Stoxx 50 last week.

France Telecom said on Wednesday that it's in talks about the acquisition of Deutsche Telekom's Spanish Internet unit, Ya. com, and has also received offers for its own Dutch mobile unit.

Three days earlier, US-based wireless provider Alltel agreed to be bought by TPG and Goldman Sachs Group buyout unit for $27.5bn.

The value of mergers and acquisitions in Europe has reached $1.24 trillion so far this year, according to data compiled by Bloomberg. Deals reached a record $1.6 trillion in 2006.

Cable & Wireless climbed 3.9% to 191 pence. The UK's secondbiggest phone company said fullyear pro"t more than doubled to �174m as international sales rose.

Analysts expected �167.2m, the average of eight estimates compiled by Bloomberg.

Vodafone, the world's biggest wireless company, rose 4.4% to 151.4 pence. Vodafone is scheduled to report full-year earnings on Tuesday. The company will probably say its loss narrowed to �2.02bn from �21.8bn the previous year, according to a Bloomberg survey.

Glaxo, the world's secondlargest drug maker, dropped 8.9% to 1334 pence, its biggest weekly decline since October 2002. The new "ndings on Glaxo's drug Avandia, released by the New England Journal of Medicine, cast doubt on the future of a drug that is taken by one million Americans and generated sales of $3bn last year.

AstraZeneca, the UK's secondlargest drug maker, lost 2% to 2693 pence. Novartis won US approval to sell an added generic copy of AstraZeneca's Toprol XL, a bloodpressure medication. Shares of Novartis still slipped 1.4% to 68.9 Swiss francs. Switzerland's biggest drug maker lost a ruling to block sales of a generic drug by Teva Pharmaceutical Industries.

Shares of Elan surged 26% to 14.69, leading gains in the Stoxx 600. Ireland's biggest drug maker said its experimental Alzheimer's medicine will move into the last stage of testing usually required for approval.

EMI Group rallied 11% to 275.25 pence after Guy Hands' Terra Firma Capital Partners agreed to buy the record label for �2.4bn. Former EMI executive Jim Fi"eld said on Friday he may offer to buy the company, raising the prospect of a takeover battle.

LogicaCMG, an Anglo-Dutch computer services provider, plunged 13% to 157 pence, the biggest decline in the Stoxx 600.

The company forecast a drop in fullyear revenue at its UK unit after a customer ended a contract.

Milestones

CLIMBER Rod Baber made the world's highest mobile phone call, using a Motorola Z8 phone to make a 40second call from the top of Mount Everest to a China Telecom mobile mast . . . more than 8,848 metres up and at minus 30degreesC.

Numbers

.DUBLIN ISEQ 9,914.41 Up 2.55% on week
.EUROPE DJ Stoxx 50 3,907.14 Down 0.24% on week
.LONDON FTSE 100 6,570.50 Down 1.06% on week
.NEW YORK DOW 13,507.28 Down 0.36% Nasdaq 2,557.19 Down 0.05%

Equity movers

IRISH SHARES

GAINERS

Company closing % Elan 14.69 Kenmare Res 0.83 9.21% Dragon Oil 2.64 6.67% Iona Tech 4.10 6.49 % Aminex 0.36 CRH 36.19 Norkom Group 2.10 4.95%

LOSERS

Company closing % Fyffes 0.87 Finance Ireland 0.15 8.82% Siteserv 0.91 5.21% Smur"t Kappa 19.85 4.93% Calyx Group* 1.37 4.79% McInerney Hldgs 2.67 4.64% Boundary Capital 1.16 4.13% *trading ceased on Calyx due to a takeover offer

INTERNATIONAL

GAINERS Company closing % Deutsche Telekom 13.43 6.76% Siemens 97.80 BT Group �97.80stg 4.84% Vodafone Group �151.40 4.41% Marathon Oil $119.11 3.96% Google $482.15 Apple $112.68

LOSERS

Company closing % Glaxosmithkline �1334.00 -8.88% Debenhams �137.5 5.66% Fortis 30.92 M & S �710.5 4.44% Aviva �801.5 4.18% Reed Elsevier �659.5 3.93% BNP Paribas 90.87 3.5%

The week ahead

MONDAY
German cost of living Japanese housing starts and construction orders Results: China Technology Development, Integral Technologies Inc (Q4)

TUESDAY
US weekly retail sales and consumer confidence Euroland current account Japanese household spending and employment stats Results: Borders Group (Q1), United Heritage Corp, BSS Group (Q4), Alpine Group (Q1)

WEDNESDAY
Tullow Oil AGM US ADP employment changes & mortgage applications Euroland money supply Japanese industrial output Results: Abacus Group, Northern Foods (Q4), GFR Pharmaceuticals, United Retail Group (Q1)

THURSDAY
Bank of Ireland and Greencore full-year earnings and interim results UK house prices, money supply and consumer credit US personal consumption and GDP annualised, Chicago purchasing managers survey, jobless claims and new construction stats Euroland business and consumer con"dence indices for May Results: BOI, HJ Heinz (Q4), Dell, Ford Motor Company

FRIDAY
IPCC chairman to address Institute of European Affairs 'carbon day' Irish NCB purchasing managers' survey Irish unemployment rate and live register statistics UK purchasing managers' survey Euroland unemployment and GDP US personal income and spending, non-farm payrolls, pending home sales, domestic vehicle sales, University of Michigan consumer con"dence index Results: John Deere Capital Corp, Bakers Footwear

The week that was

BOOM OR DOOM?

THE OECD called time on the housing market in Ireland last week, declaring that "the housing boom is over". In response, Irish economists argued that those fancy French economists don't understand Ireland . . . unless of course they happen to predict good news, in which case they are the soul of wisdom.

For example, there is the prediction that Irish economic growth will be around 5.5% this year and slowing to 4.1% next year. That puts Irish growth at roughly twice the OECD average, which was predicted to slow to 2.7% this year and in 2008.

MINE'S A PINT

BOTTLE EXPORT figures released on Friday offered some needed good news for exporters, showing a 5.7% increase in exports year on year. Everybody agreed this was good news, right?

Well, yes and no. First, the biggest gainer was in the 'beverages and tobacco' sector at a whopping 32% jump . . . but much of that was C&C shipping out bottles of cider to stock up in Munich and Barcelona in the run-up to launching Magners into those two markets. The other thing, export sources said, was that the increase over last year seems bigger because the export figures for the period in 2006 were revised downward.

MEETING HALFWAY

A KEY strand of the "pensions crisis" narrative which has underpinned the international shift towards definedcontribution schemes has been that cradle-to-grave schemes that guarantee a level of post-retirement income are unsustainable for businesses.

Now, in a breakthrough decision, AIB's board has split the difference and accepted a hybrid scheme on the recommendation of the Labour Relations Commission. Under the new system, salaries up to 62,000 will be covered by a defined benefit with earnings above that covered by contributions of 10% by the bank and 5% by employees.

The Pensions Ombudsman quickly proclaimed the compromise as a new standard, but if the reversal marks the beginning of a shift in employee pension provision, it raises as many questions as it answers. The knock against defined benefit has always been cost and the drag on the balance sheet.

So far brokers have remained sanguine on AIB, though, suggesting this may be less of a problem than popularly believed.

And how will employees feel about slipping on a new set of golden handcuffs after years of being hectored to take out portable PRSAs?

REDS FLASH SOME GREEN

IT'S a peculiar kind of communist government that takes a $3bn stake in one of the world's most influential private equity houses, but that's exactly what China did last week when it bought 10% of Blackstone, the New York firm with investments in more than 100 diverse companies.

The idea is to spread out some of China's massive $1.2 trillion in foreign currency reserves and, presumably, to learn something about private equity investments, which are making fortunes all over the world lately.

There is also the prospect of cashing in on Blackstone's planned initial public offering . . . an intriguing reversal of the take-private trend . . . which could, according to some market observers, ironically raise money for a Blackstone foray into . . . where else? . . . China.