FTSE Moves: Top-flight stocks buoyed by BAT plans for £38bn Reynolds mega-merger

Blue chip stocks struggled for direction in afternoon trading with even a mega merger in the tobacco industry barely managing to distract traders.

British American Tobacco (BAT) said it plans to merge with its US partner Reynolds in a deal valued at $47bn (£38bn), sending BAT's shares more than 3% higher.

The merger would bring together some of the tobacco industry's best-known brands, including Lucky Strike, Rothmans, Dunhill and Camel cigarettes.

The FTSE 100 Index lifted 13.8 points to 7040.7, after BAT said it wants to buy the 57.8% of Reynolds it does not already own. The FTSE 250 Index slipped 1.4 points to 17943.7.

IG chief market analyst Chris Beauchamp said: "Big mergers and acquisition news in the tobacco world has helped to take the focus off a quiet broader market, with the FTSE barely moving so far." Shares in BAT lifted 157.5p to 4960.5p.

In afternoon trading the biggest risers in the FTSE 100 Index were Burberry Group (+60p to 1510p), British American Tobacco (+157.5p to 4960.5p), Imperial Brands (+103.5p to 3965.5p), Royal Bank of Scotland (+3.7p to 190p) and Rio Tinto (+43.5p to 2662p).

The biggest fallers in the FTSE 100 Index were Direct Line Insurance (-8.2p to 346.6p), Shire (-80p to 5045p), InterContinental Hotels Group (-50p to 3175p), ITV (-2.6p to 170.6p) and Whitbread (-49p to 3777p).

In afternoon trading the biggest risers in the FTSE 250 Index were Acacia Mining (+55.8p to 525p), IP Group (+13.7p to 154.1p), Keller Group (+26p to 670.5p), Sophos Group (+6p to 235.4p) and SSP Group (+7.6p to 340.8p).

The biggest fallers in the FTSE 250 Index were Countrywide (-8.5p to 200p), Grafton Group (-17p to 492.5p), Hunting (-15p to 542p), JRP Group (-3.4p to 123.7p) and Senior (-4.1p to 172.8p).