By Carla Mozee, MarketWatch

LONDON (MarketWatch) -- European stocks ended with meager gains Wednesday, but BG Group PLC shares held to strong gains as the energy producer agreed to a blockbuster merger with oil-and-gas giant Royal Dutch Shell.

The Stoxx Europe 600 closed up 0.1% at 404.66, pulling slightly higher as oil-and-gas, technology and health-care shares moved up.

The index had been above its record closing high of 405.50, set in March 2000, but losses for the telecommunication, basic materials and consumer-goods sectors prevented the pan-European index from eclipsing that mark.

Still, the Stoxx 600 is up 18% this year, highlighting the impact of the European Central Bank's EUR1.1 trillion asset-purchase program.

BG (BRGYY) surged more than 40% at the open of trade after news Royal Dutch Shell PLC agreed to buy the energy producer for GBP47 billion ($69.6 billion) in cash and shares ( BG confirmed it was in advanced talks with Shell following a late Tuesday report from The Wall Street Journal.

London-listed BG shares closed higher by 26.7% at 11.53 pounds ($17.21). Shell (RDSB) shares, however, were slammed, with B-class shares falling 8.6%. Read: Shell CEO: We didn't do BG deal because of cheap oil (

Talk about consolidation in the energy industry has ramped up ( as a result of the slide in oil prices.

"We see decent strategic merit in this deal," which could offer growth in Brazil and other benefits for Shell, said BNP Paribas in a note. "We also think there may be some positive read across for BP as well, which has been also been mentioned as a potential target for one of the U.S. majors."

Shares of British oil major BP PLC (BP) rose 0.5%, ending off session highs.

The Stoxx 600's oil-and-gas group on Wednesday rose 2.5%, as a number of energy-related shares were among the strongest advancers in European trade. Portuguese oil-and-gas firm Galp Energia climbed 6.2%, Genel Energy PLC gained 6%, and Tullow Oil PLC tacked on 5.4%.

But the energy sector also pared gains after disappointing U.S. oil supply data ( sent U.S. oil futures (CLK5) and Brent crude futures sharply lower late in the European session.

While BG Group shares soared in London, the U.K.'s FTSE 100 ( turned lower, ending down 0.4% at 6,937.41. France's CAC 40 also turned lower, falling 0.3% to 5,136.86. Germany's DAX 30 lost 0.7% to end at 12,035.86.

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