Smoke and Mirrors? Tobacco Stocks Rise on Hopes of DOJ Settlement - TheStreet

Reports this morning that the

Justice Department

may be looking to settle the multibillion dollar lawsuit filed against the tobacco industry sent stocks in the sector moving higher today. The

Dow Jones U.S. Tobacco Index

gained 3.3% over the course of the day, while the

American Stock Exchange Tobacco Index

rose 0.6%.

The suit contends that the tobacco industry has made deceptive statements about the harmful and addictive effects of smoking. Reports today suggested that Attorney General

John Ashcroft

has assembled a team of lawyers to work on a possible settlement rather than pursuing the case in the courts.

Philip Morris

(MO) - Get Report

rose 3.1% today to $45.99, while

R.J. Reynolds

( RJR) climbed 4.4% to $54.63.

Universal

(UVV) - Get Report

, a leaf tobacco seller, rose 1.3%, and

UST

(UST) - Get Report

, a maker of smokeless tobacco products, gained 3.6%.

British American Tobacco

(BTI) - Get Report

rose 3.4% to $15.62.

A federal judge has already thrown out two of the four federal counts that the Justice Department is pursuing against the tobacco industry. The government is attempting to get one of those two dismissed counts put back in contention.