NEW YORK CITY: Investors sent tobacco stocks higher Tuesday, on reports that major tobacco companies were close to settling all of the suits brought by 21 states to recover Medicaid costs associated with smoking. But both the companies and the states deny that they are anywhere close to a comprehensive settlement. "There have been discussions about settlements with individual companies, most notably the Liggett Group," said Chris DeWitt, a spokesman for the Michigan attorney general's office. "But I have no information that there is any talk yet about a global settlement." Bloomberg News, quoting sources involved in the negotiations, had reported that the companies were attempting to settle the suits for as much as $250 billion. But tobacco firms were encouraged to hang tough by a West Virginia ruling on Friday that struck down most of that state's suit. Tobacco also has lost some of its allure as growing numbers of socially-conscious investors insist that fund managers avoid the stocks. For those so inclined, the American Medical Association has just introduced its own financial guide -- a listing of 53 tobacco-free mutual funds. Yet despite the looming threat of massive legal settlements, shares in tobacco firms like Philip Morris and RJ Reynolds continue to do well. Hugh Johnson, First Albany’s chief investment strategist thinks one factor supporting tobacco shares is growing investor concerns that the stock market may be due for a major correction. Reason: people smoke more when they’re nervous. And when the economy seems uncertain, investors tend to turn to the food, tobacco and pharmaceutical firms that make the products that people buy no matter what they’re doing without.