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FTSE 100 flat, FTSE 250 down 0.1%

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UK economy slows less than expected

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Diploma falls after finance chief steps down

Aug 14 (Reuters) - Britain's FTSE 100 was nearly flat on

Thursday as advances in defence stocks offset declines in energy

and mining shares, while investors assessed the country's latest

GDP figures.

As of 1018 GMT, the blue-chip index was down 0.06%,

after three consecutive sessions of gains, while the

domestically focused midcap index also declined 0.1%

Investors parsed Wednesday's British GDP data for the second

quarter, which showed the economy slowed less than expected

despite U.S. trade tariffs and a weaker jobs market.

Much of the slowdown is due to manufacturers frontloading

goods in the previous quarter to avoid tariffs, said George

Brown, senior economist at Schroders. "This drag should ease in

the third quarter, even against a tougher global trade

backdrop," he said.

"We expect the Bank of England to keep rates on hold for the

remainder of the year."

The energy sector was the main drag on the

FTSE 100, down 1.3%

Harbour Energy ( PMOIF ) led the losses, falling 4.5%, while

oil majors Shell and BP each fell over 1%.

Industrial metal miners also retreated 1%

amid weakness in copper and iron ore prices.

The aerospace and defence index led the

gains, up 2.2%.

Among individual stocks, British Gas owner Centrica ( CPYYF )

rose 2.5% after announcing it will jointly buy National Grid's

Grain LNG terminal with U.S.-based Energy Capital

Partners for about 1.5 billion pounds ($2.04 billion).

Insurer Aviva jumped 3.5% to a 17-year high after

raising its interim dividend and reporting a 22% rise in

half-year operating profit, boosting the life-insurer's index

1.6%.

The non-life insurers index also advanced

1.3%, with Admiral Group rising 4.8% after reporting a

67% jump in half-year pretax profit.

Technical products distributor Diploma fell 3.4%

after finance chief Chris Davies stepped down over personal

conduct issues.

($1 = 0.7365 pounds)