UPDATE 1-Revitalised trade hopes, Burberry jump boost FTSE 100

Yadarisa Shabong and Shashwat Awasthi

* FTSE 100 up 0.7%, FTSE 250 up 0.3%

* Miners, financials boost blue-chip index

* Burberry gains after LVMH-Tiffany deal

* IAG up on preliminary deal with pilots union (Adds news items, analyst comment, updates share prices)

Nov 25 (Reuters) - Britain's FTSE 100 advanced further on Monday as investors were hopeful of some progress to end the prolonged U.S.-China trade war and luxury brand Burberry gained after French peer LVMH agreed to buy U.S. jeweller Tiffany.

The FTSE 100 added 0.7% with miners and Asia-focused HSBC providing the biggest boost, after U.S. national security adviser Robert O'Brien said an initial trade deal was still possible by the end of the year.

The index, which had jumped more than 1% in the previous session, was also supported by a 2.5% gain in Burberry after Louis Vuitton owner LVMH's $16.2-billion deal for Tiffany.

The FTSE 250 rose 0.3% as of 0913 GMT, tracking gains in the local currency, as Prime Minister Boris Johnson pledged to bring his deal to leave the European Union back to parliament before Christmas.

Johnson also rolled out an election manifesto that promised more public sector spending and no new taxes.

Shares of housebuilders such as Berkeley and Persimmon, most sensitive to the domestic economy, gained 1% each on the blue-chip bourse.

Domestic stocks have been rising in recent sessions as polls show the Conservative Party most likely to gain a majority in the upcoming general election, enabling the government to deliver Brexit after more than three-and-a-half years.

IAG rose 1% after British Airways and its pilots union BALPA reached a preliminary agreement to end the pay dispute that resulted in the first walkout by pilots in the airline's history.

Hopes that Washington and Beijing may yet make progress on a trade deal after O'Brien's comments drove risk sentiment, with analysts also pointing to China's assurance of stronger protections for intellectual property rights as a key driver.

"The move suggests that key concessions are being made in order to increase the prospects of a partial U.S.-China deal, which is giving investors another opportunity to capitalize on risk-on trading activity," FXTM analyst Han Tan said.

Though conflicting headlines emerged that officials from both countries had said a more advanced "phase two" deal was looking less likely, markets chose to remain optimistic.

Mid-cap Hochschild Mining, which had slipped 9% on Friday after a lacklustre production outlook for 2020, lost another 5% and sank to near six-month low. (Reporting by Yadarisa Shabong in Bengaluru; Editing by Shounak Dasgupta)