(Reuters) - London's blue-chip shares staged a tentative recovery on Friday from their worst session in six weeks a day earlier, led by gains in banks and miners, even as weak earnings dragged on utilities, SSE and Centrica, and Johnson Matthey.
The FTSE 100 index was up 0.2 percent and the FTSE 250 roughly flat by 0935 GMT after suffering steep falls in the last session, when the Bank of England slashed its economic growth forecasts amid Brexit uncertainty.
Investors also fretted about the protracted U.S.-China trade spat after news that U.S. President Donald Trump did not plan to meet Chinese President Xi Jinping before a March 1 deadline set by the two countries to strike a trade deal.
"Whilst this is a bit of a blow, it's not in itself a reason to think trade talks are not going anywhere," Neil Wilson, Markets.com analyst, said.
At home, British Prime Minister Theresa May came away from Brussels on Thursday with a pledge of renewed talks that held some hope for a new Brexit deal.
Homebuilders, among the most exposed to a hit to the economy in case of a no-deal Brexit, gained some ground after two sessions of losses. Barratt topped the main index with a 1.5 percent gain, while peers Berkeley and Persimmon also rose.
Banks gained after slipping in the previous session, but RBS was in the red a day after a report that the British government would consider trimming its stake in the bank.
Luxury brand Burberry added 1.2 percent, boosted by French luxury handbag label Hermes' results and comments that sales momentum in its Chinese stores stayed strong in the fourth quarter.
SSE, one of Britain's so-called "Bix Six" energy suppliers, erased early losses to be up 0.5 percent despite cutting its profit target. A rating downgrade by Citigroup dragged peer Centrica down nearly 2 percent.
Auto catalyst maker Johnson Matthey was knocked lower after rival Umicore warned of slowing vehicle demand in China, the world's top car market.
Oil shares underperformed as crude prices were dampened by worries about a global economic slowdown, while dollar earners including Unilever advanced on a weaker pound.
Investors shunned bookmaker shares as horse racing was postponed in Britain until at least the middle of next week after an outbreak of equine influenza. GVC Holdings, William Hill, 888 Holdings and Playtech fell.
Earthport shares surged 13.4 percent as Visa tabled an increased buyout offer for the British payment company, topping an earlier bid from Mastercard.
Tour operator Thomas Cook slumped 11.4 percent after surging in the last session, when it put its airline business up for sale. Morgan Stanley cut its price target on the stock to 50 pence from 60 pence.
(Reporting by Muvija M and Shashwat Awasthi in Bengaluru; editing by Josephine Mason and Dale Hudson)