U.K. Stocks Rise, Led by BAE and Imperial Party Gaming Falls

Friday August 18, 2006

U.K. stocks rose, led by BAE Systems Plc. Shares of Europe's biggest weapons company climbed on the sale of fighter planes to Saudi Arabia.

Imperial Tobacco Group Plc and British American Tobacco Plc paced gains after a U.S. district court ruled tobacco companies did not have to fund large-scale programs to help smokers quit.

PartyGaming Plc, the biggest online poker company, dropped after its stock was downgraded by ABN Amro Holding NV.

The FTSE 100 Index added 26.20, or 0.4 percent, to 5926.60 at 9:40 a.m. in London. The measure has advanced 1.8 percent for the week. The FTSE All-Share Index gained 13.14, or 0.4 percent, to 3011.48 today. Ireland's ISEQ Overall Index dropped 9.38, or 0.1 percent, to 7782.64.

BAE Systems added 10.75 pence, or 3 percent, to 370.75, its biggest gain in almost a month. The U.K. agreed to supply the largest economy in the Middle East with 72 Eurofighter Typhoon planes, the official Saudi Press Agency reported.

Eurofighter is a Munich-based joint venture between BAE, Finmeccanica SpA and European Aeronautic, Defence & Space Co. The sale to Saudi Arabia will be the first order for the planes outside Europe.

Imperial Tobacco, Europe's second-largest cigarette maker, advanced 28 pence, or 1.6 percent, to 1,806. British American Tobacco, the world's second-largest publicly traded cigarette producer, rose 13 pence, or 0.9 percent, to 1,459.

U.S. District Judge Gladys Kessler in a case against cigarette companies yesterday said ''unfortunately'' she lacks authority to order a costly smoking-cessation program. The government had sought billions of dollars from the tobacco companies to help smokers quit and reduce youth smoking.

Party Gaming, Oil Stocks

''It's a complete and unequivocal practical win for the industry,'' said David Adelman, a Morgan Stanley analyst. ''There's no prospect of a future substantial hit to the industry.''

PartyGaming fell 3 pence, or 2.6 percent, to 110.5. ABN Amro cut its recommendation for the stock to ''hold'' from ''buy.''

Royal Dutch Shell Plc, Europe's biggest oil producer by market value, rose 24 pence, or 1.3 percent, to 1,876. BP Plc, the region's No. 2, gained 6. 5 pence, or 1.1 percent, to 615.5.

Shares of the two account for 17 percent of the value of companies on the FTSE 100.

Crude oil rose as much as 82 cents, or 1.2 percent, to $70.88 a barrel in New York on concern supplies may be disrupted during September, the peak hurricane season, and as pressure intensifies on Iran to scale down its nuclear research.

The following stocks also rose or fell in London. Stock symbols are in parentheses:

Amlin Plc (AML LN) climbed 5.25 pence, or 2.1 percent, to 259. Credit Suisse Group raised its recommendation on shares of the Lloyd's-of-London insurer of spacecraft and yachts to ''outperform'' from ''neutral'' in expectation of higher earnings to be reported on Sept. 4.

BPP Holdings Plc (BPP LN) added 5.75 pence, or 1.4 percent, to 433.25. Dresdner Kleinwort lifted its share-price estimate for the owner of law and business schools to 500 pence from 490.