Shares in British tobacco and insurance company BAT Industries gained 2 per cent yesterday after comments from President Clinton raised hopes that a final US tobacco settlement could be near, analysts said.

Mr Clinton on Wednesday proposed raising cigarette prices and called for several tougher restrictions on youth access to tobacco. But he left an original $368.5 million (£245.6 million) pact agreed in June basically intact, industry watchers said. Mr Clinton said his main objective was to reduce smoking by young people rather than to extract money from the tobacco industry.