UPDATE 1-Trump reassurance on China lifts FTSE 100; May’s exit news expected

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* FTSE 100 up 0.5%, FTSE 250 up 0.6%

* Oil stocks, financials biggest boosts on main index

* ITV rises after deal with English Football Association

* Mothercare jumps after FY results

* UK-focused stocks again ahead of PM May’s exit news (Adds company news items, updates share moves)

May 24 (Reuters) – Britain’s main stock index advanced on Friday, aided by hopes of a resolution to the prolonged U.S.-China trade war, while UK-focused stocks gained amid expectations that Prime Minister Theresa May would announce a resignation date.

The FTSE 100 bounced 0.7% by 0814 GMT and the midcap index was up 0.6%. All sectors in the main index were in positive territory by 0752 GMT as risk appetite came back after U.S. President Donald Trump predicted a swift end to the trade dispute with China.

House-builders and airlines, which are considered prone to any hit to the economy from a chaotic no-deal Brexit, recovered sharply as May appeared set announce her departure date after two years of trying to push through a Brexit divorce deal.

“Any leadership contest is unlikely to be concluded much before September … which means that the UK may well have to ask for another extension from the EU in order to get any sort of deal across the line,” CMC Markets analyst Michael Hewson said.

Oil majors BP and Shell were the biggest boosts to the main index following gains in crude prices, while miners broke a four-day losing streak after copper prices rebounded as the dollar dipped.

Broadcaster ITV was at the top of the FTSE 100 leader-board with a 2.1% rise after signing a deal with the English Football Association that will make FA Cup matches entirely free-to-air to viewers from the 2021-22 season.

Mothercare was the standout across UK indexes, up 19.1% to be on course for its best day in a year after its annual report showed restructuring efforts were paying off.

Small-cap media firm Tarsus shot up by 37% after European private equity firm Charterhouse said it had made a cash bid valuing the company at about 561 million pounds.

Gains in the broader indexes followed steep losses in the last session when Britain-focused stocks were pressured by Brexit uncertainties and growing pressure on May to step down.

Jitters over the course of Brexit, along with tit-for-tat trade tariffs between Washington and Beijing, have left the blue-chip index on course for its first monthly drop this year. (Reporting by Muvija M and Shashwat Awasthi in Bengaluru; Editing by Catherine Evans)

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