Insurance stocks lead gains in London, Direct Line jumps
FTSE 100 up 0.08%, FTSE 250 up 0.8%
Renewi jumps on $887 mln takeover bid by Australia's Macquarie
Energean tops FTSE mid-cap losses on production forecast cut
Updates to market close
Nov 28 (Reuters) -The UK's domestically focused mid-cap FTSE 250 ended higher on Thursday, while the main FTSE stock index nudged up in light trading volumes, with Direct Line boosting the insurance sector after rejecting Aviva's $4.16 billion takeover bid.
The FTSE 100 .FTSE held its ground at 8,281.22 points, while the FTSE 250 .FTMC climbed 0.8%. The Thanksgiving holiday in the U.S. kept the trading volumes light throughout the day.
Insurance stocks .FTNMX303020 jumped 5.9%, registering their biggest one-day gain in four years, with Direct Line Insurance DLGD.L jumping 41% after rejecting Aviva's AV.L bid, saying it "substantially undervalued" the company. Aviva's shares fell 2.3%.
"I think the expectation is that there will be more than just that first offer and clearly it does suggest that there is interest in this space," said Danni Hewson, head of financial analysis at AJ Bell.
Spirax-Sarco Engineering SPX.L rose 3.9% on positive rating actions by two brokerages on the valve-maker's stocks, while Sainsbury SBRY.L rose 3.1% after J.P.Morgan upgraded the supermarket's shares to "overweight" from "underweight".
Among major movers, Renewi RWI.L soared 46% after asset manager Macquarie's MQG.AX preliminary takeover deal of the waste management firm for 700.9 million pounds ($888 million).
Dr Martens DOCS.L climbed 11.8%, with a brokerage attributing the gain to the bootmaker's better-than-expected first-half results.
On the flip side, Energean ENOG.L dropped 8.6% to the bottom of the FTMC index after the gas producer lowered its full-year production forecast.
Meanwhile, one of the country's most experienced retail veterans said Britain's tax-raising budget showed the government did not understand business. Finance Minister Rachel Reeves' Oct. 30 budget has been criticised by businesses after she tapped companies for an additional 25 billion pounds of taxes a year to rebuild public services.
Additionally, business sentiment in Britain's services sector is falling at the fastest rate in two years, partly as a result of tax rises in Reeves' first budget.
Wednesday's strong U.S. inflation data raised concerns about a cautious stance on U.S. rate cuts.
Back in the UK, traders expect the Bank of England to hold borrowing costs steady amid concerns about inflation rising again.
($1 = 0.7895 pounds)
Reporting by Ankika Biswas in Bengaluru; Editing by Sonia Cheema and Hugh Lawson
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