UPDATE 2-FTSE 100 soars as election talk knocks sterling

* FTSE 100 up 1%, FTSE 250 up 0.5%
* Exporters boost blue-chips as sterling skids
* AstraZeneca hits record high on positive trial results
* M&S slips on FTSE 100 relegation worries

(Adds news item, analyst comment, updates to closing prices)
By Shashwat Awasthi
Sept 2 (Reuters) - London's FTSE 100 surged 1% on Monday,
shrugging off news of the latest U.S.-China trade tariffs, as
exporter stocks firmed following a slide in sterling on the
prospect of an election against the backdrop of Brexit.
The main index .FTSE hit its highest in nearly a month,
partly boosted by AstraZeneca AZN.L , which rose 3% to an
all-time high after separate trials showed its drugs helped
patients with cardiovascular conditions. The mid-cap FTSE 250 .FTMC rose 0.5%, though trading
volumes on both UK indexes were thin due to a U.S. market
holiday.
Companies that book a major chunk of their earnings in U.S.
dollars such as Diageo DGE.L , Unilever ULVR.L and BAT
BATS.L jumped as the pound weakened ahead of a showdown this
week between the government and the lawmakers opposed to a
no-deal Brexit.
With 59 days till Britain is scheduled to leave the European
Union, Prime Minister Boris Johnson threatened to purge any
lawmaker in his party who votes against the government on
Brexit, as he looks to make good on his promise of delivering
Brexit on Oct. 31, with or without a deal. The latest volley of tariffs between Washington and Beijing,
which came into effect over the weekend, was also spurring some
defensive buying.
Escalating worries over global trade and a looming recession
weighed on the FTSE 100 in August, as it recorded its sharpest
monthly fall since October. Meanwhile, fears of a no-deal Brexit
had led the mid-caps to their first monthly fall since May.
"Gains may be fragile," Markets.com analyst Neil Wilson said
of the FTSE 100's rise on Monday. "After a rough August though,
traders should buckle up for more volatility in September."
On a low-key day for corporate news, Marks & Spencer MKS.L
shed 1.4% on expectations of being relegated from the FTSE 100
for the first time since the blue-chip index was created in
1984. Also weighing on shares of the 135-year old retailer was
Goldman Sachs reinstating coverage on the stock with a 'sell'
rating, saying recent trading patterns in the retailer
"continued to be disappointing".
"It is clear that UK consumers are becoming savvier, and M&S
are undergoing a restructuring scheme, but it seems the consumer
climate is deteriorating at a quicker rate then M&S is turning
itself around," CMC Markets analyst David Madden said.