Altria Raises Cigarette Prices

Altria Group Inc. (MO) advanced nearly 5% on Thursday as investors thought the company's decision to raise the price of Marlboro and other premier brands by 71 cents a pack will help the cigarette maker's profits.

Altria said the price increases, which will be effective from March 9, are due to costs related to the upcoming raise in federal excise tax on cigarettes to $1 from 39 cents per pack. Last month, Philip Morris also raised prices by about 9 cents per pack.

However, the company plans to cut prices for the smokeless tobacco brands it acquired through its purchase of UST Inc. by 62 cents per tin to compete better in the U.S. tobacco market, which has seen declining volumes amid higher taxes and bans on smoking in public places.

Altria was trading up 4% to $15.69 at noon on the New York Stock Exchange.

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