* FTSE 100 up 0.4%, FTSE 250 up 0.7%
* U.S.-China trade deal back in focus
* Midcaps boosted by BoE rate-cut hopes
* Pennon, Spirent also support FTSE 250
* Housebuilders gain after upbeat view from Savills
(Adds company news items, updates share moves)
By Shashwat Awasthi and Muvija M
Jan 13 (Reuters) - London's main stock index gained on
Monday, in step with global peers, as investors took heart from
the imminent signing of a Phase 1 U.S.-China trade deal, while
hopes of further interest rate cuts by the Bank of England
helped the midcaps outperform.
The FTSE 100 added 0.4%, having earlier touched its
highest level so far this year, as trade hopes were complemented
by easing Middle East tensions.
The FTSE 250 outshone the blue-chips and the
European benchmark with a 0.7% rise on its best day
since Jan. 2.
A Bank of England policymaker said over the weekend that he
would vote for policy easing later this month unless economic
data improved significantly.
"One senses the bank doesn't want to get behind the curve
and is seeking to get a jump on markets whilst still teeing up
the (interest rate) cut," Markets.com analyst Neil Wilson said.
Data showing Britain's economy grew at its weakest annual
pace in over seven years in November also fanned hopes of a rate
cut.
The midcaps were also boosted by a 7.1% jump in Pennon
after a report https://www.bloomberg.com/news/articles/2020-01-11/kkr-bids-5-2-billion-for-u-k-waste-company-viridor-telegraph
that the company had rejected private equity firm KKR's
bid for the UK utility's waste management unit.
Its shares hit an all-time high and helped those of
blue-chip peers United Utilities, Severn Trent
and Centrica gain more than 2% each.
Housebuilders climbed higher, led by a 2.2%
rise in Taylor Wimpey, after upbeat forecast and bullish
comments from real estate services provider Savills.
Savills' shares leapt 7.2% to scale a record high.
Focus now shifts to Washington, where the United States and
China will ratify their preliminary trade deal on Wednesday,
while the corporate earnings season also kicks off this week.
"The deal is the focal point... With the Phase 1 deal baked
in, what markets want to know is how quickly -- if at all -- the
two sides can move things forward to Phase 2," Wilson said.
A brighter trade view, along with a rating upgrade from BofA
Global Research, helped BAE Systems climb 3.6% to the
top of the main index.
Lending support to the more domestically-exposed FTSE 250
was Spirent Communications, which surged 14.1% -- its
biggest one-day gain in almost a year -- on better-than-expected
annual profit guidance.
In the same index, Ferrexpo jumped 8.3% after the
iron ore pellet producer Ferrexpo cut its net debt year-on-year
to $282 million. The number also came in significantly below
$356 million estimated by JP Morgan.
Retailers were among steepest small-cap fallers.
Fashion brand Ted Baker lost 6% after RBC downgraded
the stock. Fellow retailer Superdry, which issued a
profit warning last week, shed 6.5% despite RBC raising its
rating.
(Reporting by Shashwat Awasthi and Muvija M in Bengaluru;
Editing by Catherine Evans)