June 29 (Bloomberg) -- The U.K.'s benchmark stock index advanced, paced by British Airways Plc and BAA Plc as oil fell for a second day, easing concerns about higher fuel costs.

ITV Plc, the largest British commercial television broadcaster, surged after the nation's communications regulator said that the company will have its fees for analog licenses cut by half this year.

The benchmark FTSE 100 Index gained for a second day, adding 15.9, or 0.3 percent, to 5106.3 at 2:46 p.m. in London. The measure closed at an eight-day low on June 27. The FTSE All- Share Index advanced 0.3 percent to 2556.10.

British Airways gained 2 pence, or 0.8 percent, to 267 pence. BAA, which operates airports including London's Heathrow, advanced 19.5, or 3.3 percent, to 618 pence.

Oil had its steepest decline in eight weeks yesterday, with most of the drop coming after European stock markets had closed, on speculation a report will show U.S. fuel inventories increased last week and gasoline demand slowed.

Crude oil for August delivery fell 51 cents, or 0.9 percent to $57.69 a barrel. Oil futures reached a record $60.95 two days ago.

ITV jumped 6.5 pence, or 5.6 percent, to 122.5 pence. ITV and Bertelsmann AG-controlled station Five will have their analog license fees cut by half this year as viewers switch to digital reception, the regulator Ofcom said.

ITV expects payments for 2005 to drop to less than 80 million pounds ($144 million) from 215 million pounds last year, the company said in a separate statement.

Kingfisher, Wolseley

Kingfisher Plc the world's third-largest home-improvement retailer, gained 0.5 pence, or 0.2 percent, to 245.25 pence. The Financial Times said in its market report column, without saying where it got the information, that the company may be bought by Wolseley Plc.

Wolseley, a distributor of heating and plumbing systems, added 0.5 percent to 1174 pence. Wolseley doesn't comment on ``market speculation,'' said spokeswoman Nina Coad. Nigel Cope, a spokesman for London-based Kingfisher, declined to comment on the newspaper article.

Energy stocks including Shell Transport & Trading Co. and BP Plc dropped as oil prices declined.

Shell Transport, which owns 40 percent of Royal Dutch/Shell Group, lost 0.6 percent to 541.5 pence. BP, Europe's largest oil company, slid 0.8 percent to 590.5 pence.

The following stocks are making gains or losses in the U.K. Stock symbols follow company names.

Hardy Amies Plc (HRD LN) rose 75 pence, or 15 percent, to 5.75 pence. The U.K. couturier that made Queen Elizabeth II's coronation dress said its annual loss narrowed as administrative and interest costs fell. Total retail sales have climbed 32 percent in this year's first half, the ``first significant increase in across-the-board retail sales since 1997,'' Chairman and Chief Executive Timothy Maltin said in a statement.

Sound Oil Plc (SOU LN) advanced 2 pence, or 36 percent, to 7.5 pence in its first day of trading on the London Stock Exchange's Alternative Investment Market. The company that invests in energy resource businesses in North and West Africa raised 10.99 million pounds in an initial public offering. The company sold 199.82 million shares at 5.5 pence each.

Thor Mining Plc (THR LN) soared 75 pence, or 38 percent, to 2.75 pence. The company raised 1.4 million pounds in its initial public offering and started trading on the London Stock Exchange's Alternative Investment Market for smaller companies today. Thor's main project is a molybdenum-tungsten deposit in Australia's Northern Territory.

To contact the reporter of this story: Alice Ratcliffe in Zurich at aratcliffe1@bloomberg.net

Last Updated: June 29, 2005 09:49 EDT