Gains by miners, banks lead Britain's FTSE higher

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* Miners provide strength on China demand

* Banks higher; StanChart up on Iran case hopes

* Rolls-Royce drops on SFO bribery talks

By Jon Hopkins

LONDON, Dec 6 (Reuters) - Britain's top share index pushed higher on Thursday, testing resistance to further gains above 5,900, led by mining firms and banks.

The mining sector extended the previous session's advance on hopes for improved demand from the world's top metals consumer after the head of China's Communist Party said he would approve policies aimed at helping economic recovery.

Support also came from renewed hopes for negotiations in Washington to avoid the so-called fiscal cliff of year-end tax hikes and spending cuts after President Obama said on Wednesday that a deal was possible within a week, though he expressed it as a hope not a prediction.

At 0911 GMT, the FTSE 100 was up 19.68 points, or 0.3 percent, at 5,811.80, following a 0.4 percent rise on Wednesday and edging above the top of its current short term trading range at 5,904.

"Traders are watching the area between 5,900 and 5,935 with keen interest," said Fawad Razaqzada, technical analyst at GFT Global.

"This corresponds with a trend line that extends back all the way to the highs we saw in the summer of 2011. A close above here may lead to some short-side liquidation and encourage fresh buying, too."

Standard Chartered led an advance by the banking sector, adding 2.4 percent after the Asia-focused lender said in a trading update it expects to pay $330 million to settle a case with U.S. regulators who accuse the bank of failing to comply with sanctions against Iran.

"To remove such uncertainty is a positive sign and allows investors to refocus on the business," said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers.

Elsewhere among the banks, Barclays was also in demand, ahead 2.1 percent after South African bank Absa Group said it will buy the African operations of its British parent for $2.1 billion, finalising a longstanding plan to fuse their businesses on the fast-growing continent. [ISD:nL5E8N60Y8]

HSBC missed out on the sector gains, with the global bank down 0.2 percent on reports it might pay a fine of $1.8 billion as part of a settlement with U.S. law-enforcement agencies over money-laundering lapses, according to several people familiar with the matter.

Rolls-Royce was the biggest blue chip casualty, down 3.0 percent as the aerospace and defence group said it had passed information to Britain's Serious Fraud Office relating to concerns about bribery and corruption involving its intermediaries overseas.

CENTRAL BANK WATCH

Investors were also a touch wary ahead of the final Bank of England and European Central Bank monetary policy decisions for 2012.

The Bank of England looks almost certain to leave policy unchanged on at midday, a month after pausing its 375 billion pound programme of bond purchases, as sticky inflation outweighs concerns about a sluggish economy.

The European Central Bank is also expected to leave interest rates at record low levels but may give a guide to next year's policy path when it delivers fresh forecasts for the euro zone economy.

"The markets will be looking for hints as to whether officials will lower their growth forecasts for the Eurozone following further financial deteriorations in some Eurozone nations," Shavaz Dhalla, Financials Trader at SpreadEx, said.

"This is also likely to be followed with reassuring comments from ECB officials, but going with past experience, this is unlikely to infuse much optimism into the markets." (Reporting by Jon Hopkins)

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