Sept. 6 (Bloomberg) -- U.K. stocks advanced, led by Rio Tinto Group on takeover speculation. BP Plc and Royal Dutch Shell Plc gained as the price of crude oil rose.

The FTSE 100 Index advanced 33.27 or 0.5 percent, to 6,304.4 at 10:22 a.m in London. The FTSE All-Share Index increased 0.5 percent to 3,263.15. Ireland's ISEQ Index fell 0.2 percent to 8,300.39.

Stocks in Europe rose, with basic resources and energy companies leading the advance. The European Central Bank said it will offer extra cash to banks to reduce the cost of credit, just hours before it is due to decide on interest rates.

Rio Tinto, the world's third-largest mining company, climbed 5.13 percent to 3,706 pence on revived speculation larger competitor BHP Billiton Ltd. and Brazil's Cia. Vale do Rio Doce may make a joint bid for the company.

``The stock seems to be up on bid speculation,'' said Richard Scott, who helps oversee about $1 billion at Iimia Investment Group in Exeter, England. ``Bid activity has been a feature of the sector over the last year. Rio owns some excellent assets, but it would be a huge deal, even for BHP.''

Separately, Rio Tinto's stock was raised to `outperform' from `market-perform' by Sanford C. Bernstein & Co.

Anglo American Plc jumped 2.3 percent to 2,907. Sanford Bernstein raised its stance on the world's second-largest mining company to `market-perform' from `underperform'.

BP, Europe's second-largest oil company, added 0.5 percent to 561.5 pence. Shell, the region's largest, increased 1.1 percent to 1,974. The price of crude oil rose 0.6 percent to $76.18.

The following stocks also gained or fell in the U.K. market. Stock symbols are in parentheses.

U.K. Companies:

Abbot Group Plc (ABG LN) declined 13.25 pence, or 4.6 percent, to 274.25. The North Sea's largest offshore drilling contractor said first-half profit fell 6 percent.

Aegis Group Plc (AGS LN) added 3.5 pence, or 2.7 percent, to 133.5. The world's largest independent buyer of advertising space said first-half operating profit rose 5.2 percent on increased Internet sales and more orders in Asia, Africa and the Middle East.

Amec Plc (AMEC LN) gained 28 pence, or 4.3 percent, to 683. The world's third-biggest engineering-services company posted a first-half profit after selling its unprofitable construction businesses.

Benfield Group Ltd. (BFD LN) fell 7.75 pence, or 2.5 percent, to 298. The reinsurance broker said first-half profit slipped 2.5 percent as a weaker dollar eroded revenue.

Catlin Group Plc (CGL LN) sank 4 pence, or 0.8 percent, to 481. The biggest insurer on the Lloyd's of London market said first-half profit was hurt by takeover costs and rose less than analysts estimated.

Devro Plc (DVO LN) slid 3 pence, or 3.4 percent, to 85. The U.K.'s largest maker of sausage casings said six-month profit fell 11 percent as sales slowed in the U.S., U.K. and Australian markets.

Drax Group Plc (DRX LN) shed 32 pence, or 4.7 percent, to 643.5. The worst-performing European utility stock this year after reporting a fall in first-half profit.

Fiberweb Plc (FWEB LN) plunged 37.5 pence, or 28 percent, to 95.5. The unprofitable U.K. maker of textiles and graphic arts materials dropped as much as 33 percent to a record in London trading after saying annual results will miss its forecasts.

Galiform Plc (GFRM LN) increased 9.25 pence, or 6.9 percent, to 143.25. The owner of the builders' merchant brand Howden Joinery had a first-half profit on growing demand for pre-built, custom-made kitchens in the U.K.

Reuters Group Plc (RTR LN) gained 9 pence, or 1.4 percent, to 639.5. Lehman Brothers Holdings Inc. raised its recommendation on Reuters, which accepted a takeover bid by Thomson Corp. in May, to ``overweight'' from ``equal-weight.''

Smallbone Plc (SML LN) advanced 7 pence, or 7.3 percent, to 103. The installer of luxury kitchens reported a first-half profit after adding stores to tap demand for upscale furniture.

Umbro Plc (UMB LN) fell 24.25 pence, or 18 percent, to 114.5. The maker of uniforms for England's national soccer team said 2008 profit will be hurt by below-forecast jersey sales.

Wolfson Microelectronics Plc (WLF LN) advanced 9.75 pence, or 3.7 percent, to 271 after Cazenove raised its recommendation on the maker of semiconductors for music players and mobile phones to ``outperform'' from ``in-line.''

Yule Catto & Co Plc (YULC LN) fell 13.75 pence, or 5.7 percent, to 229.25. The maker of drug and cosmetic ingredients said first-half profit fell 12 percent as competition and raw material costs increased.

Irish Companies:

Anglo Irish Bank Plc (ANGL ID) added 28 cents, or 2 percent, to 14.08 euros. Credit Suisse Group raised its recommendation on the country's third-largest lender by market value to ``neutral'' from ``underperform.''

Bank of Ireland Plc (BKIR ID) sank 19 cents, or 1.5 percent, to 13.08 euros. Credit Suisse cut its recommendation on the country's second-largest lender to ``underperform'' from ``neutral,'' citing ``earnings risk from increased wholesale funding costs.''

To contact the reporter on this story: Sarah Thompson in London at sthompson17@bloomberg.net

Last Updated: September 6, 2007 05:32 EDT