* Banks gain, offsetting weakness in miners
* Schroders, Aviva boosted by broker upgrades
* BG Group falls after posting Q2 profit drop
By Harpreet Bhal
LONDON, July 29 (Reuters) - Britain's FTSE 100 share index rose in early trade on Wednesday a day after registering the first decline in the last 12 sessions, with a rebound in financials offsetting weakness in gas firm BG and mining stocks.
By 0815 GMT the FTSE 100 was up 0.9 percent, or 39.01 points at 4,567.85 points in a choppy early session, after ending 1.3 percent lower on Tuesday as it failed to break records with a 12th session of gains.
Banks added the most points to the index on Wednesday, with Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland and Standard Chartered up between 1.1 and 2.8 percent.
The index ignored hefty falls in Asian stocks and negative Wall Street futures, and analysts said that low volumes could be exaggerating moves.
David Morrisson, market strategist at GFT Global said the market could be in for a period of consolidation as investors begin to scrutinise corporate earnings more closely in the weeks to come.
"I think there is a little bit of nervousness as we've had such a good rally this month and everyone is due a pull back. I think we're heading for a nasty sell-off at some stage. I don't see how we can go on without a pause or a pullback," he said.
Oil and gas firms were higher, with BP, Royal Dutch Shell and Tullow Oil up 0.1-0.9 percent, but BG Group fell 1.4 percent after posting a 31 percent drop in second-quarter profits.
Defensive stocks gained ground. British American Tobacco rose 0.7 percent, while Imperial Tobacco was up 1.6 percent, and Vodafone rose 1.3 percent.
Asset management firm Schroders gained 6.7 percent, the top riser on the blue chip index, after Morgan Stanley raised its rating on the stock to "overweight" from "underweight" and upped its price target.
Aviva climbed 2.6 percent after Deutsche Bank raised its rating to "buy" in a UK insurance sector review.
Confectionery group Cadbury rose 1.5 percent, after reporting a rise in first-half profits and saying its sees higher profit margins for 2009.
Low-cost airline easyJet rose 3.3 percent, after the firm predicted a full-year pretax profit of 20-50 million pounds despite the severe industry downturn, while maintaining its fleet growth plans up to 2011.
BAE Systems was up 1.1 percent, after it won a U.S. contract and ahead of results due on Thursday. z
On the downside, miners were the biggest drag on the index, reflecting negative metals prices. Anglo American Antofagasta, BHP Billiton, Rio Tinto and Xstrata fell 0.1-0.9 percent.
BHP Billiton, the world's largest iron ore miner has agreed with unnamed customers to take a 33-44 percent price cut for contracted iron ore shipments, covering 23 percent of its total sales volumes.
Investors are expected to focus on the Bank of England consumer credit and mortgage lending data for June, due at 0830 GMT, while June U.S. durable goods numbers will be eyed later in the session. (Editing by Greg Mahlich)