By Simon Kennedy, MarketWatch
LONDON (MarketWatch) — U.K. stocks moved mostly higher Thursday, though gains for the benchmark index were limited by shares in oil giant BP PLC, which fell after the U.S. government filed a civil lawsuit over the Gulf of Mexico oil spill.
The FTSE 100 index (UK:UKX 5,898, +16.30, +0.28%) rose 0.3% to 5,901.24, driven by gains for miners and drug stocks.
Other European markets edged higher as EU leaders prepared to meet at a summit in Brussels to discuss the sovereign-debt crisis. See Europe Markets.
BP (UK:BP. 466.80, -9.75, -2.05%) (BP 43.86, -0.58, -1.31%) was the biggest faller on the index, dropping 2.4%.
The U.S. government said late Wednesday it is suing the company and eight other defendants, alleging that negligence and lax safety procedures led to the Gulf of Mexico oil spill. See full story on the lawsuit.
“While not wholly unexpected, the move by the U.S. Justice Department will nevertheless shine the spotlight once again on the risks associated with deepwater drilling in particular, and insurance for any potential liabilities,” said Goodbody Stockbrokers analyst Gerry Hennigan.
Separately, the latest round of U.S. embassy cables released by WikiLeaks reportedly highlight similarities between the Gulf of Mexico disaster and a little-reported major gas leak at BP’s operations in Azerbaijan in 2008.
Other oil stocks were mostly higher, including BG Group PLC (UK:BG. 1,308, +6.50, +0.50%) , which gained 0.7% after the company said the 11th well drilled in a concession in the Santos Basin offshore Brazil was successful.
Elsewhere in the U.K. Thursday, mining stocks were mostly higher, including a 1.2% rise for Rio Tinto PLC (UK:RIO 4,451, +20.50, +0.46%) (RIO 68.93, -1.42, -2.02%) after the company said a sale of shares in Cloud Peak Energy Inc (CLD 20.01, -0.69, -3.33%) could generate gross proceeds of around $500 million for the group.
Among other miners, Vedanta Resources PLC (UK:VED 2,416, +28.00, +1.17%) .rose 1.1% and Xstrata PLC (UK:XTA 1,447, +5.50, +0.38%) climbed 0.6%.
Pharmaceutical stocks added to the previous session’s gains, which were driven by Novartis’ (NVS 58.99, +3.16, +5.66%) deal to acquire the remaining stake in Alcon Inc. (ACL 164.10, +1.67, +1.03%) and restart its share buyback program.
Hopes of cash returns from other drug companies have lifted the sector, with GlaxoSmithKline PLC (UK:GSK 1,280, +11.00, +0.87%) (GSK 39.80, -0.06, -0.15%) rising 1% on Thursday.
