Dec. 23 (Bloomberg) -- European oil stocks including BP Plc and Shell Transport & Trading Co. rose amid optimism about profit growth after this year's record prices for crude.

``Even though oil prices are falling, the average price per barrel this year is well above all estimates,'' said Jacobo Blanquer, who helps manage $320 million, including Repsol YPF SA and Total SA shares, at Nordkapp Inversiones SV SA in Madrid. ``Oil companies' earnings in the fourth quarter and the first half of next year are going to be very good.''

Pharmaceutical stocks fell, paced by AstraZeneca Plc after Europe's third-largest drugmaker was reprimanded by the U.S. Food and Drug Administration. Bayer AG dropped after saying it will halt development of an experimental stroke medicine.

The Dow Jones Stoxx 50 Index added less than 0.1 percent to 2776.55 as of 11:20 a.m. in London, with more than twice as many stocks rising as falling. The Stoxx 600, which closed near its highest since July 2002 yesterday, was unchanged. The Euro Stoxx 50 Index for the 12 countries using the euro added 0.3 percent.

Royal Ahold NV rose after the Dutch supermarket owner agreed to sell two U.S. units for as much as $660 million. Infineon Technologies AG declined as Micron Technology Inc., a U.S. chipmaker, failed to beat sales estimates.

Benchmarks fell in 10 of the 18 Western European markets. Germany's DAX Index rose 0.1 percent, France's CAC 40 Index gained 0.3 percent and the U.K.'s FTSE 100 Index added 0.1 percent.

Oil Earnings

BP, Europe's largest oil company, added 0.4 percent to 510.5 pence. Shell Transport, the owner of 40 percent of Royal Dutch/Shell Group, added 0.9 percent to 442.75 pence.

The stocks gained even as crude-oil futures slipped almost 1 percent in New York, adding to yesterday's 3 percent plunge.

Earnings for the oil industry may have risen over 70 percent from the fourth quarter of 2003 after oil prices peaked above $55 a barrel in New York and $51 a barrel in London in October, Goldman Sachs Group Inc. said in a note yesterday, adding that the industry is having what may ``be the best quarter on record.''

Ahold, the world's third-largest retailer, rose 2.7 percent to 5.70 euros. The company agreed to sell its Bi-Lo LLC and Bruno's Supermarkets Inc. units to Lone Star Funds, a Dallas- based private investment company.

Chief Executive Anders Moberg, who joined Ahold after the grocer overstated profit over three years, aims to raise 2.5 billion euros from selling units by the end of 2005 to reduce debt. Ahold has now received commitments for asset sales worth as much as 2.3 billion euros, spokesman Walter Samuels said.

AstraZeneca, Bayer

AstraZeneca paced declines by health-related companies, dropping 1.1 percent to 1,850 pence. Europe's third-largest drugmaker was reprimanded by the U.S. Food and Drug Administration for underplaying risks linked to its Crestor cholesterol drug in an advertisement.

Shares of Bayer, Germany's second-biggest drug and chemical maker, slipped 0.6 percent to 25.14 euros after saying it will end development of its experimental Repinotan drug for strokes, after the medicine failed to help patients in a study.

Health stocks are one of only three Stoxx 600 groups to drop this quarter. The shares have been dragged lower amid the failure of AstraZeneca's Iressa lung-cancer treatment in a study and concerns about the safety of Pfizer Inc.'s Celebrex.

Infineon, Europe's second-largest chipmaker, slid 1 percent to 7.94 euros. Micron, the world's No. 2 maker of computer-memory chips, said first-quarter sales rose 14 percent to $1.26 billion, compared with the $1.3 billion expected by analysts surveyed by Thomson Financial.

Micronas Semiconductor Holding AG, the biggest Swiss maker of computer chips, fell 0.6 percent to 54.15 Swiss francs.

Karstadt, Altran

KarstadtQuelle AG, Germany's No. 1 department-store operator, added 1.3 percent to 7.67 euros. The company may have a narrower sales decline in 2004 than originally expected, Reuters said, citing unidentified people after a supervisory board meeting.

Altran Technologies SA rose 3.5 percent to 7.45 euros. Europe's largest contractor for technology research said it secured 150 million euros ($201 million) in loans from banks under an accord lasting five years.

Shares of Jarvis Plc, the U.K. engineer whose debt is more than 10 times its market value, surged 12 percent to 14.5 pence after the company sold a highway business for 24.5 million pounds ($47 million) to help reduce borrowing.

KBC Buyout

KBC Bancassurance Holding NV, Belgium's No. 3 financial- services company, tumbled 4.2 percent to 56.5 euros, the biggest drop in the Stoxx 600. KBC will buy its main shareholder, Almanij NV, to simplify its ownership structure and attract more international investors.

KBC will offer Almanij shareholders 1.35 shares for each Almanij share held, the two companies said. Almanij owns 67 percent of KBC. The holding company is 70 percent owned by a group that includes Flemish families and a farmers' union.

Shares of Almanij fell 1.2 percent to 75.65 euros. Until today, the stock had gained 27 percent since Nov. 22, when KBC said the two planned a reorganization.

U.S. government reports on U.S. personal spending, jobless claims and durable-goods spending in the world's biggest economy are expected later today. The University of Michigan also releases its monthly report on consumer sentiment.

Yesterday, the Standard & Poor's 500 Index and Dow Jones Industrial Average rose to three-year highs as oil tumbled and a government report confirmed the economy accelerated in the third quarter.

To contact the reporter on this story: Margo Towie in Brussels at mtowie@bloomberg.net.

Last Updated: December 23, 2004 06:47 EST