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* FTSE 100 up 0.4 pct
* Bellway update boosts housebuilders
* easyJet rises after upgrade
* Banks, GKN, Ashtead among fallers
LONDON, June 14 (Reuters) - A rise in housebuilders underpinned gains on Britain's top share index on Wednesday following a well-received update from mid cap Bellway, with a weaker pound also lending support.
Britain's blue chip FTSE 100 index climbed 0.4 percent to 7,528.33 points by 0912 GMT, while the mid caps gained 0.8 percent.
While housebuilders were hit by a selloff in the immediate aftermath of the UK's general election, which resulted in a hung parliament, a trading update from Bellway eased investors' concerns as the firm said that demand did not slow in the run-up to the election.
"Housebuilders generally ... have been marked down because of fears over the UK economy, the UK property market, but actually the numbers that are coming out of these companies are still pretty reassuring," said Laith Khalaf, senior analyst at Hargreaves Lansdown.
"There are a number of tailwinds that (the housebuilders) also have, one of which is extremely low interest rates, another of which is the chronic lack of housing in this country, and a third thing is the government help to buy scheme," Khalaf added.
Bellway's shares rose 4.5 percent to a 1-month high, while blue chip peers Barratt Developments, Persimmon and Taylor Wimpey were among the top FTSE gainers, up between 1.9 percent to 2.3 percent.
British large caps extended gains after sterling weakened following UK data which showed that earnings after inflation contracted at the fastest pace since 2014, highlighting the growing post-Brexit strain on households.
Budget airline easyJet also enjoyed gains, its shares advancing 1.2 percent following a supportive note from Davy Research which upgraded the stock to "neutral" from "underperform", citing its higher operating leverage in the current environment.
"We believe that the European low-cost carriers will continue to see improving pricing trends as we approach peak summer, albeit a consensus among the airlines has yet to form on whether pricing will be positive or negative," analysts at Davy said in a note.
Only a dozen or so more cyclical stocks such as banks Lloyds and Standard Chartered and energy stock were in negative territory on the FTSE, while equipment hire firm Ashtead dropped 2.8 percent, extending losses from the previous session after its earnings update.
"Strong FY17 results, but no consensus upgrades, saw a muted investor reaction and we see more downside from here," analysts at UBS said, adding that accelerating competition and slowing end markets this summer could leave Ashtead's valuation exposed.
Likewise shares in engineering group GKN also came under pressure after Panmure cut its rating to "sell" from "hold", on the back of challenges in the U.S. auto and Middle East aircraft markets.
(Reporting by Kit Rees; Editing by Keith Weir)