Britain's FTSE gains thanks to miners, Prudential

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* FTSE 100 up 0.3 pct, mid caps gain 0.1 pct

* Prudential (SES: K6S.SI - news) jumps after insurer announces demerger

* Morrison's shares reverse course after results

* Dignity (Other OTC: DGNTY - news) , Hikma power mid caps

By Kit Rees

LONDON, March 14 (Reuters) - A jump in Prudential's shares and gains for mining stocks lifted the UK's top share index on Wednesday, while results brought cheer to several mid-cap stocks.

The blue chip FTSE 100 index was up 0.3 percent at 7,157.09 points by 1001 GMT, recovering some losses from the previous session.

Insurer Prudential was the top gainer, its shares rising more than 4 percent after it said it would demerge its UK and Europe retirement and asset management business from its international insurance business.

It said it planned to demerge M&G Prudential into a separate company with a premium listing on the London Stock Exchange (Other OTC: LDNXF - news) .

"A demerger driven by geography is one which makes commercial and strategic sense," Richard Hunter, head of markets at Interactive Investor, said.

Mining stocks provided the biggest boost to the FTSE, thanks to some solid industrial production data from China, which pushed metals prices higher given that China is the biggest consumer of metals in the world.

Shares (Berlin: DI6.BE - news) in Glencore (Frankfurt: 8GC.F - news) , Rio Tinto (Hanover: CRA1.HA - news) , Anglo American, BHP Billiton (NYSE: BBL - news) and Antofagasta (LSE: ANTO.L - news) all rose by between 1.1 percent and 2.2 percent.

Results were also in focus. Despite an early rise, shares in Morrison's gave up gains to trade 0.7 percent lower after the supermarket gave a full-year update.

While Morrison's beat forecasts and announced a special dividend, analysts voiced concerns over the sustainability of the grocer's growth, while others were disappointed that the dividend was a one-off.

Morrison's shares are up 2 percent so far this year in what is a tough environment for food retailers due to competition in pricing and online.

"The market has not been buying into the group's recent run of form," Neil Wilson, senior market analyst at ETX Capital, said.

"There is a sense that this kind of growth will be difficult to maintain, but this has been the argument for some time and has continually been wrong," Wilson (Oslo: WILS.OL - news) added.

Outside of the blue chips, shares in funeral services provider Dignity surged more than 15 percent, putting the stock on track for its biggest one-day gain since listing in 2004 after reporting full-year results.

Dignity's shares are still down more than 45 percent this year on the back of concerns around a price war.

Hikma was another big mid cap gainer, jumping 14 percent after the drugmaker's full-year profit and revenue met analyst expectations.

The mid cap index, however, was up just 0.1 percent.

(Reporting by Kit Rees; Editing by Susan Fenton)