(Reuters) – Britain’s top share index edged higher on Thursday as gains in oil majors more than offset a slump in BT Group after it said the UK government was set to probe Altice UK’s stake in the telecoms group.

The blue-chip FTSE 100 was up 0.1% and the domestically focussed FTSE 250 index inched 0.2% higher.

Energy firms Shell and BP rose about 1% each as crude prices firmed on signs of tight supply. [O/R]

However, caution prevailed across global markets due to persistent concerns over growth in China and worries about the Federal Reserve’s intent to tighten policy quickly. [MKTS/GLOB]

BT tumbled 5% after it said Britain’s business minister will launch a national security review of a deal by Altice founder Patrick Drahi to increase his stake in BT to 18%.

“It seems reasonable to conclude that the Govt thinks Altice/BT raises relevant national security issues,” Jefferies analysts said in a note.

“Fortunately, consensus is not counting on an Altice UK takeover to support the BT share price at current levels. An all-clear in the government review is therefore an upside scenario.”

Water company United Utilities slid 6.9% after it warned of higher costs due to inflationary pressures.

The wider utility stocks came under renewed pressure. British finance minister Rishi Sunak, later on Thursday, will set out more details of the government’s response to the growing cost-of-living pressures, expected to include windfall taxes on oil and gas companies to fund the package.

Power generators Drax, Centrica and SSE fell between 0.6% and 2.6% after falling sharply earlier this week on fears of windfall taxes.

Asset manager Intermediate Capital Group jumped 8.1% to the top of FTSE 100 after full-year results.

Leading the midcap index higher, public services outsourcer Serco gained 9.2% as it boosted its annual profit outlook.

Chemicals maker Johnson Matthey Plc fell 6.4% after forecasting 2022-23 operating profit at the lower half of market estimates, as supply disruptions due to China’s lockdowns and component sourcing from Ukraine hurt its auto customers.

(Reporting by Sruthi Shankar in Bengaluru; editing by Uttaresh.V and Sriraj Kalluvila)