(For a Reuters live blog on U.S., UK and European stock

markets, click or type LIVE/ in a news window)

*

FTSE 100 down 0.4%, FTSE 250 up 0.1%

*

HSBC ( HSBC ) falls after plans to buy rest of Hang Seng Bank

*

Homebuilders fall after RICS housing data

*

Volution hits record high after annual results

Oct 9 (Reuters) - London's FTSE 100 retreated from the

previous session's record high on Thursday, as declines in

shares of HSBC ( HSBC ) weighed down the banking sector, while gains in

miners kept losses in check.

The blue-chip FTSE 100 fell 0.4% to 9,511.79 as of

1043 GMT, while the mid-cap-focused FTSE 250 was up

0.1%.

HSBC ( HSBC ) dropped 5.8%, set for its steepest one-day

decline in more than six months. The bank said it plans to buy

out minority interests in Hong Kong's Hang Seng Bank, where it

holds a majority stake, in a deal worth HK$106.1 billion ($13.63

billion).

The broader banking sector weighed heavily on

the market with a 3.3% decline.

Lloyds Banking Group ( LYG ) dropped 2.6% after the lender

warned it would need to set aside more cash to cover the costs

related to motor finance scandal. Merchant bank Close Brothers

fell 4.4% to the bottom of the FTSE 250.

The wider homebuilders index shed 1.5%, with

Taylor Wimpey and Barratt Redrow ( BTDPF ) dropping 4.3%

and 3.3%, respectively.

A survey published by the Royal Institution of Chartered

Surveyors said Britain's housing market lost momentum for a

third consecutive month, and its measures of buyer demand and

agreed sales were stuck in the negative territory in September.

On the flip side, base metal miners gained

0.9%, tracking a rise in copper prices, with Anglo American

gaining 1.8%, among the top performers on the FTSE 100.

Volution Group ( VLUTF ) rose 5.7% to a record high after

posting strong fiscal year results, helping the construction and

materials sector outperform its peers.

The FTSE 100 has been rallying to record highs, on a boost

from resource-linked stocks and banks this week. It recorded its

best weekly showing since October 2008 on Friday as renewed

investor interest in pharma stocks led them to regain some

ground lost through the year.

Secure Trust Bank shares slipped 19% after the bank

said it expects annual underlying profit before tax to fall

below market expectations.