May 29 (Reuters) - UK indexes marked a second straight

month of gains on Friday, buoyed by hopes that the U.S. and Iran

were nearing a deal to extend their ceasefire.

The blue-chip FTSE 100 index ended down 0.2% and

posted monthly gains of around 0.3%. The midcap FTSE 250

gained 0.4% on the day and 4.3% for May.

* Shares of Ocado ( OCDGF ) soared 7.1% after supermarket

group Asda struck a deal with the technology firm to overhaul

its online business across the UK.

* Oil prices slipped nearly 2% after the U.S. and Iran

reached an agreement to extend a ceasefire and lift restrictions

on shipping through the Strait of Hormuz, sources told Reuters.

* President Donald Trump said he would make a final decision

on Friday.

* Shares of oil majors Shell and BP were

mixed. A broader gauge of British energy stocks

posted its biggest monthly drop in a year, as crude prices

eased.

* Hopes of de-escalation in the U.S.-Iran conflict and

easing bets on UK interest rate hikes have buoyed domestic

stocks over the past two weeks.

* Bank of England Governor Andrew Bailey said that allowing

inflation to run above the central bank's 2% target is justified

given the economic uncertainty and reiterated that the BoE had

tightened monetary policy by taking rate cuts off the table.

* Money market bets show traders are pricing in at least one

25 bps interest rate hike this year and see a 28% chance of

another such move, down from 50% probability earlier this week.

* Shares in UK retailers B&M, Currys ( DSITF ),

Dunelm ( DNEMF ), Wickes Group ( WCKGF ) dipped in the range of

0.9% and 2.4% after Deutsche Bank downgraded their ratings,

citing weaker consumer spending and confidence.