* FTSE 100 up 0.1 pct, reversing early gains
* FTSE 250 down 0.1 pct
* Bank stocks biggest boost to main index
* Persimmon leads sell-off among housebuilders
* Centamin slips on mid-caps (Changes analyst comment, updates closing prices)By Muvija M and Shashwat AwasthiFeb 25 (Reuters) - London's blue-chip index squeezed outgains on Monday as banks got a boost from comments about apossible Brexit delay, while housebuilders were hit by reportsthe government was worried about Persimmon's handling of a statehouse-funding scheme.The FTSE 100 closed 0.1 percent higher, laggingother major European bourses where investors took comfort fromU.S. President Donald Trump's decision to delay raising tariffson Chinese imports.
The more domestically-focussed midcaps shed someearly losses to end down 0.1percent.
"There is a fear in the financial market that if the UKleaves the EU without a trade deal, interest rates in the UK arelikely to go down ... the slightly improved situation inrelation to Brexit is helping the banking stocks," said CMCMarkets analyst David Madden.Lloyd's of London insurer Hiscox , which recentlyjoined the FTSE 100, added 3 percent after reporting a profitfor the year that beat market expectations. The pound gained after European Council President DonaldTusk said delaying Brexit beyond the planned March 29 exit datewould be a "rational solution" as there was no majority in theBritish parliament to approve a divorce deal.Sterling's rise briefly pulled the exporter-heavy FTSE 100into the negative territory.Homebuilders suffered their worst day in amonth on reports Britain's housing minister is pressingPersimmon on how it operates a public funding scheme fornew house buyers.
Persimmon slid 5 percent on the main index, pulling downrivals Taylor Wimpey and Barratt . Bunzl fell 4 percent after the company said itsmargins remained under pressure from rising costs, even as itsfull-year profit beat expectations. Primark owner Associated British Foods fell 2percent after guiding to flat first-half earnings. The company'sfinance chief separately said it was "unbelievable" the Britishgovernment was contemplating a no-deal Brexit.Prime Minister Theresa May has put off a parliamentary voteon her Brexit deal until March 12, which lawmakers see as atactic to get more of them to back her plan - already rejectedonce - in an attempt to avoid a split from the EU without anagreement. "Maybe she is thinking some MPs who don't like her deal maylike it in two weeks time when there is very little time left onthe clock," said Madden.Also weighing on markets were data from the Confederation ofBritish Industry showing the country's services industry was itsgloomiest since the 2009 financial crisis, due to the"unmistakably negative" impact of Brexit uncertainty. Centamin slumped nearly 30 percent - its worstone-day fall in more than six years - as its annual goldproduction fell and a 2019 production forecast missed Jefferies'estimates.Bucking the trend, sub-prime lender Provident Financial rose 3.5 percent after rejecting an unsolicited takeoveroffer from smaller rival Non-Standard Finance (NSF) . NSFslumped 6.7 percent. (Reporting by Muvija M and Shashwat Awasthi in Bengaluru;Editing by Mark Potter and Andrew Heavens)
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