London (AFP) – Huge deal-making in the pharmaceutical sector pushed up London stocks on Tuesday, even though tension over the crisis in Ukraine lurked in the background, traders said.

Shares in pharmaceutical groups surged owing to a major reshaping of the sector, driven by Novartis of Switzerland and GlaxoSmithKline in London.

London’s benchmark FTSE 100 index climbed 0.79 percent to 6,677.55 points compared with Thursday’s closing level — the last trading day before European markets closed for Easter.

AstraZeneca’s share price shot up 7.63 percent to 4,070 pence and GSK rallied 5.42 percent 1,643.55 pence.

“The pharma sector stood out … on the back of news that two of the biggest players in the sector are making major changes to their business models,” said Farhan Ahmad, a trader at TradeNext.

Swiss pharmaceutical giant Novartis and British group GlaxoSmithKline (GSK) announced a major shake-up of their healthcare divisions on Tuesday in deals worth billions of dollars.

It comes as reports over the weekend suggested that US pharmaceutical giant Pfizer was considering a $ 100 billion takeover of British rival AstraZeneca.

“Pharmaceutical stocks have had a shot in the arm … on rumours of an impending takeover for AstraZeneca,” said Mike McCudden, head of derivatives at stockbroker Interactive Investor.

Novartis said on Tuesday that it would buy GSK’s oncology, or cancer treatment, business for $ 16 billion (11.5 billion euros) in cash and sell its vaccines division, excluding vaccines for flu, to the British company for up to $ 7.1 billion, also in cash.

The two companies also announced a joint venture to create “a world-leading consumer healthcare business,” focused on wellness, oral health, nutrition and skin health and expected to pull in around $ 10 billion in annual sales.