UPDATE 2-Banks support FTSE 100 even as airlines hit by Lufthansa warning

* FTSE 100, FTSE 250 up 0.2%
* Banks top boost to main index
* Lufthansa's profit alert hurts airlines
* Kier at record low after dividend suspended
* Huatai's GDRs rise on London market debut

(Adds details, updates to closing prices)
By Muvija M and Yadarisa Shabong
June 17 (Reuters) - London's main index inched up on Monday
as rises in banking shares outweighed the impact of a profit
alert from Germany's Lufthansa on airlines, while UK contractor
Kier Group skidded to an all-time low.
Both the FTSE 100 index .FTSE and the FTSE 250 midcap
index .FTMC ended 0.2% higher.
With the spotlight on Wednesday's U.S. Federal Reserve
policy decision, the banking index .FTNMX8350 broke a four-day
losing streak with a 0.9% rise, led by Asia-exposed banks
including HSBC HSBA.L and Prudential PRU.L after Hong Kong's
leader backed down over an extradition bill that has sparked
mass protests.
"It's hard to recall a time we headed into an FOMC meeting
with so much at stake and with so much uncertainty about what
might be agreed," Markets.com analyst Neil Wilson said.
"Traders may start to show some nervousness ahead of the Fed
meeting if they think it won't be accommodative as hoped."
The Fed is expected to leave interest rates unchanged but
potentially lay the groundwork for a cut later this year as a
prolonged trade war with China puts more strain on the U.S.
economy. The Bank of England also meets this week, with little
expected but all eyes on central bank policymaking globally
after two weeks in which hopes of policy easing have driven a
stock market recovery from losses in May.
EasyJet EZJ.L and British Airways owner IAG ICAG.L gave
up 4.4% and 2.2%, respectively, on the main bourse after
Lufthansa LHAG.DE cut its 2019 profit outlook due to
competition from low-cost rivals in Europe. Mid-cap component Wizz Air WIZZ.L also dipped 2.6%.
Kier KIE.L , whose shares have plunged this month due to a
report of a discounted sale of its unit and a profit warning,
lost another 17.4%, reaching a new all-time low, after the
builder suspended dividend, and announced divestment plans and
1,200 job cuts. "The profit warning from Friday is still fresh in traders'
minds, and even though today's restructuring scheme is a clear
sign the firm is taking action, it still hasn't reassured
investors," CMC Markets analyst David Madden said.
DS Smith SMDS.L slipped 5.1% on its worst day in over four
months after Exane BNP Paribas downgraded the stock to
"underperform" on worries about the plastic packaging firm's
capital spending and exceptional costs.
Energy provider Centrica CAN.L also tumbled to more than a
decade low, ending 2.4% lower after Macquarie initiated coverage
with an "underperform" rating.
Huatai Securities' GDR HTSCq.L ended 3.7% higher on its
first day of trading in what is Britain's first listing via the
long-awaited London-Shanghai stock connect project. Huatai, among China's largest brokerages, had earlier risen
as much as 7.1% to $21.96 on the day.