UPDATE 2-Banks push FTSE 100 higher, while BoE spurs economic hopes

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* UK gilt yields hit one-year high
* 888 Holdings jumps on strong earnings
* FTSE 100 up 0.3%, FTSE 250 flat

(Updates to close)
By Shivani Kumaresan and Amal S
March 18 (Reuters) - London's FTSE 100 ended higher on
Thursday, with bank stocks providing the biggest boost after a
spike in treasury yields, while encouraging statements from the
Bank of England raised hopes over the short-term economic
outlook.
After falling as much as 0.31%, the blue-chip FTSE 100 index
.FTSE turned upwards, eventually ending 0.3% higher.
Bank stocks including HSBC Holdings HSBA.L , Standard
Chartered STAN.L , Barclays BARC.L were the top boosts to the
index as U.S. treasury yields hit 14-month highs on dovish
statements from the Federal Reserve. US/
Heavyweight mining stocks including Rio Tinto RIO.L , BHP
Group BHPB.L and Anglo American AAL.L gained on higher base
metal prices.
The Bank of England said Britain's economic recovery was
gathering pace thanks to the speed of COVID-19 vaccinations
while its policymakers were split over the prospects for
longer-term improvement, dampening speculation about a reversal
of stimulus. "Central bankers often like to highlight that the outlook is
'unusually uncertain', but the Monetary Policy Committee is
feeling a little more comfortable about the prospects for the
economy than at its last meeting six weeks ago," said Hugh
Gimber, global market strategist at J.P. Morgan Asset
Management.
British 10-year gilt yields GB10YT=RR rose to a one-year
high after BoE's statement.
The domestically focused mid-cap FTSE 250 index .FTMC
ended flat, with gains in industrials and financials offset by
losses in real estate stocks.
A recent rise in treasury yields had hampered an otherwise
strong start to the year for UK blue chips, although the midcap
index has fared better than its larger peer on hopes of a
vaccine-led economic recovery this year.
Gambling group 888 Holdings 888.L rose 4.5%, after posting
higher annual adjusted core earnings and signalling strong
momentum in 2021 so far, as more people shifted to online
betting during coronavirus restrictions. Drinks maker Fever-Tree FEVR.L fell 12.3%, despite a
better 2021 revenue forecast with at-home drinking catching on
and sales at lockdown-hit bars and restaurants expected to
gradually gain momentum.