(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window)
    * GDP grew by 0.2% in July from June vs. est 0.4%
    * Miner Ferrexpo rises after Ukraine forces score victories
    * FTSE 100 and FTSE 250 add 1.7% each 

 
    By Johann M  Cherian and Bansari Mayur Kamdar
    Sept 12 (Reuters) - UK stocks rallied into the close on
Monday, with a surge in banking and mining stocks pushing the
blue-chip FTSE 100 to over two-week highs even as data showed
Britain's economy expanded less than expected in July.
    The FTSE 100         and the domestically focussed midcap
index         gained 1.7% each, aided by an upbeat global mood
on news that Ukrainian forces advanced into territory seized
from Russian troops, their worst defeat since the war's early
weeks.             
    European markets, most affected by the war spanning several
months, surged. The region's stocks gauge          closed up
1.8%.
    "Kyiv's sudden momentum has many hoping that this moment is
a turning point with the war against Russia," said Edward Moya,
senior market analyst at Oanda.
    Ukraine-focused miner Ferrexpo Plc          jumped 11.3% to
top UK's midcap index.             
    Battered retail stocks                were the best
performers on the day with a 4.4% rise. Shares of Marks and
Spencer         and Asos          climbed over 7%, while Tesco
         jumped 5.5%.
    Investors will focus on UK jobs and inflation data later
this week for clues on the health of the domestic economy and
direction of interest rates.
    Data on Monday showed Britain's economy grew less than
expected in July, raising the risk that it is already in a
recession, with the sharp climb in energy tariffs hurting demand
for electricity and a leap in the cost of materials hitting the
construction sector.             
    "The slow start to Q3 combined with a now confirmed Bank
Holiday on 19 September should put the economy on course for a
technical recession – albeit a marginal one – in Q3," Deutsche
Bank's Sanjay Raja wrote in a note.
    However, investors shrugged off the data amid global risk-on
moves on hopes of cooling U.S. inflation.               
    Mining stocks                gained 2.1%, tracking stronger
metal prices on supply risks in top consumer China and a weaker
dollar.        
    A 1.2% jump in energy stocks                on higher crude
prices also buoyed the UK markets.      
    HSBC          rose 2.1% after its Chief Financial Officer
Ewen Stevenson told an investor conference that the bank will
most likely resume share buybacks in the second half of next
year.             

 (Reporting by Johann M Cherian, Bansari Mayur Kamdar and
Aniruddha Ghosh in Bengaluru; Editing by Saumyadeb Chakrabarty,
Sriraj Kalluvila and Lisa Shumaker)