UPDATE 2-British midcaps jump on Brexit, vaccine optimism

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* Last moments to reach Brexit trade deal - EU

* UK inflation rises to 0.7% in October

* Pfizer says its COVID-19 vaccine is 95% effective

* Insurer RSA jumps on 7.2 billion pound cash takeover offer

* FTSE 100 up 0.3%, FTSE 250 adds 0.9%
(Adds comment; updates to close)

By Devik Jain

Nov 18 (Reuters) - British midcaps jumped on Wednesday as
hopes of a post-Brexit trade deal with the European Union and
further positive vaccine data from drugmaker Pfizer offset
concerns about economic damage from surging coronavirus cases.

The domestically focused FTSE 250 index, considered
a barometer for Brexit sentiment, closed 0.9% higher, with
shares in Micro Focus International surging 31.2% after
the software firm forecast a higher annual margin.

The EU's Trade Commissioner said on Wednesday Britain and
the bloc were in the last moments to reach a Brexit trade
deal.

"There are no guarantees a Brexit agreement will be reached
but if one can be secured it would likely be a positive catalyst
for UK stocks in the long run – removing a key source of
uncertainty which has weighed heavily for more than four years,"
said AJ Bell investment director Russ Mould.

After falling nearly 0.6% in morning trade, the blue-chip
index ended 0.3% higher, after Pfizer Inc
disclosed final results from its late-stage COVID-19 vaccine
trial that showed it was 95% effective.

Cyclical stocks such as banks, housebuilders
and energy companies rose, although a
stronger pound capped gains on the index.

"The initial leg up of (vaccine news) is probably priced in
already. There's still lots of headwinds to growth and activity
from the renewed lockdowns and so investors may be just being a
little bit cautious." said Ian Williams, economics and
strategist at Peel Hunt.

Britain on Wednesday reported further 529 COVID-19 deaths
and 19,609 cases, a day after it recorded its highest daily
death figure since May.

Meanwhile, official data showed British inflation ticked
higher in October to 0.7%.

RSA Insurance Group jumped 4.6% after it agreed a
7.2 billion pounds cash takeover offer by overseas rivals.

Halfords Group Plc fell 4.6% after the bicycles and
car products retailer sounded cautious about its second-half
outlook due to lockdowns.
(Reporting by Devik Jain in Bengaluru; Editing by Subhranshu
Sahu and Mark Potter)