* FTSE 100 up 0.3%, FTSE 250 up 0.5%
* Miners gain as Shanghai nickel prices hit record high
* Positive U.S.-China trade signals buoy sentiment
* AIM-listed Shoe Zone tanks after warning on results (Adds news item, graphic, updates to closing prices)
By Shashwat Awasthi and Indranil Sarkar
Aug 30 (Reuters) - Gains in mining companies after nickel prices hit an all-time high and signs of a resumption of U.S.-China trade talks lifted London's FTSE 100 on Friday, as the index snapped a four-week losing streak.
The main index added 0.3%, but still posted its sharpest monthly fall since October in a month ravaged by escalating trade disputes and fears of a recession. The mid-cap FTSE 250 gained 0.5%.
Heavyweight mining companies such as Rio Tinto, BHP and Glencore rose more than 2% each and boosted the blue-chip index as a waste spill at a nickel plant in Papua New Guinea raised supply fears.
Investors also took heart from signals emanating from Washington and Beijing overnight that they would resume talks to try and end their protracted trade war, which broadly supported global stock markets.
"The more measured tone in deciding to focus on next month's meeting to discuss removing the extra duties has seen some optimism start to creep back in," said CMC Markets analyst Michael Hewson.
Calming headlines on the trade front came at the end of a torrid month that saw the United States and China exchange another volley of tariffs, while the latter also allowed its currency to devalue, which stirred further uneasiness and kept dealers away from risky assets.
"All-in-all, it emphasises once again that the U.S.-China trade dispute and/or its resolution remains the only game in town for investors globally," said Jeffrey Halley, senior market analyst, Asia Pacific at Oanda.
However, oil majors BP and Shell were among a handful of blue-chip stocks in the red as they tracked a drop in crude prices.
The sterling remained subdued as lawmakers scrambled to find a solution to the chaotic Brexit process, pushing up exporter stocks such as Diageo and Unilever.
The more domestically-focussed FTSE 250, which has broken ranks with the local currency in recent months, gained, supported by a 10.3% surge in building materials distributor Grafton after its first-half results.
Shares of blue-chip IT group Micro Focus and mid-cap consumer credit provider Amigo Holdings clawed back some losses from the previous session's steep falls. Micro Focus rose 5.5%, while Amigo climbed 12.6%.
Shares of AIM-listed Shoe Zone shed nearly a third of their value and sank to an all-time low after the footwear retailer warned annual results would be below expectations.
(Reporting by Shashwat Awasthi in Bengaluru; Editing by Sriraj Kalluvila and Angus MacSwan)