UPDATE 2-UK shares flat in short holiday session

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* FTSE 100 heads for best monthly performance in a year

* No London stocks report on Dec 27, 28 due to holidays

* FTSE 100 and FTSE 250 flat
(Updates to close)

By Bansari Mayur Kamdar

Dec 24 (Reuters) - UK shares closed nearly flat in light
pre-Christmas trading on Friday, but posted strong weekly gains
on hopes the global economy can weather the impact from the
Omicron coronavirus variant.

The blue-chip FTSE 100 index, which was flat at
7372.10 at the close of a shortened trading session, is on track
for its strongest monthly performance in almost a year as a
surge mining and banking stocks helped investors to look past
soaring Omicron cases.

Shares of heavyweight banks including HSBC,
Barclays, Standard Chartered and LLoyds Group
have all benefited after the Bank of England raised its
interest rate to 0.25% from a record low of 0.1% for the first
time since the pandemic.

"The FTSE 100 has not had as stellar a year as some, but the
recovery of 7,400 today puts it in good stead for the year
ahead," said Chris Beauchamp, chief market analyst at IG Group.

"A run at the pre-pandemic highs could still be possible if
Omicron concerns can be kept under control and earnings continue
to recover in the fashion they have throughout 2021."

The mid-cap index was subdued at the close on Friday
but logged its strongest week since early August, as travel and
leisure stocks rose strongly in December.

The British government said on Thursday there is a lower
likelihood of hospitalisation for those infected by Omicron
versus the Delta strain, but the variant's higher
transmissibility may still lead to significant numbers needing
hospital treatment.

"The Prime Minister has said that there will be no new
restrictions before Christmas but the widespread expectation is
that some will be introduced in the days immediately after
that," said Klaus Baader, global chief economist at Société
Générale.

Building materials business CRH edged up 0.6% after
announcing a shares buyback of $300 million.
British markets will remain shut for Christmas and Boxing Day
on Monday and Tuesday.

(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by
Devika Syamnath, Uttaresh.V and Jane Merriman)