UK's FTSE edges higher, Lloyds rallies after results

* FTSE 100 index rises 0.2 pct

* Lloyds gains after profit jump

* Utilities, property stocks down

* Major European markets closed

By Atul Prakash

LONDON, May 1 (Reuters) - Britain's top equity index edged higher on Friday, with Lloyds surging after reporting profits at the top end of analysts' forecasts and miners advancing on expectations of further stimulus in China, the world's top metals consumer.

But gains were limited as election jitters and higher bond yields put pressure on sectors such as utilities and property.

Lloyds shares rose 6.7 percent after Britain's biggest retail bank reported an underlying pretax profit of 2.2 billion pounds ($3.4 billion) for the three months to the end of March, up 21 percent on the year.

"Lloyds continues to act as the favourite of its sector for investors to play the banking comeback, with its lack of an investment bank keeping it away from further significant fines," said London Capital Group dealer Will Hedden.

The broader market also got support from a rise in basic resources stocks, with the UK mining index rising 3.2 percent as data showing China's factories struggled to grow in April reinforced expectations Beijing will roll out more measures to support the slowing economy.

The blue-chip FTSE 100 index, which hit a record high of 7,122.74 points on April 27, was up 0.2 percent at 6,973.64 points by 1054 GMT. The index remains up by nearly 6 percent since the start of 2015.

However, utility companies such as Centrica (LSE: CNA.L - news) and United Utilities (LSE: UU.L - news) , and housebuilders including Barratt Development and Taylor Wimpey (LSE: TW.L - news) fell 0.7 to 1.5 percent on uncertainty about the election result.

The ruling Conservatives and opposition Labour Party have been neck-and-neck in most polls, while the Scottish National Party could emerge as the third-biggest party.

Labour says it would ensure cheaper energy costs for consumers by the end of this year if it wins the election. It has promised to immediately empower the energy regulator to force prices down, and this has impacted utility stocks.

"Uncertainty ahead of the UK election appears to be dampening sentiment, particularly with regards to the property and utility stocks," said Keith Bowman, analyst at Hargreaves Lansdown.

Utilities and housebuilders were also being hurt by a recovery in bond market yields. U.S. Treasury yields rose in April for their second monthly increase since January.

"Much of the focus has been on the bond market, where yields have actually staged an impressive comeback. This boost to safe-haven yields has meant that sectors such as utilities and housebuilders - known for their high dividend payouts - have seen some profit-taking," said IG (LSE: IGG.L - news) analyst Chris Beauchamp.

(Additional reporting by Sudip Kar-Gupta; Editing by Mark Trevelyan)