* Oil majors track crude prices higher * Lloyds up on media reports 1,400 jobs to be cut
* Banks broadly higher; HSBC slips
By Farah Master
LONDON, June 9 (Reuters) - Britain's top share index hovered in positive territory around mid-session on Tuesday, supported by oil majors, while banks were broadly higher.
By 1010 GMT the FTSE 100, which is up more than 28 percent since slumping to a six-year trough in March, was up 6.31 points, or 0.1 percent higher at 4,411.53.
The index closed 33.34 points or 0.8 percent lower at 4,405.22 on Monday, weighed down by weakness in commodity stocks and banks and political uncertainty after dire European election results for the ruling Labour party.
"A lot of people are sitting on their hands unsure what to do at the moment, whether this rally has further legs on it or it is now reaching a plateau," said Philip Gillett, sales trader at IG Index.
"The main moves now are going to be data driven just because the market seems to be running out of gas." Energy stocks tracked crude prices higher with oil reaching over $69 a barrel. BP, Tullow Oil Royal Dutch Shell, BG Group were up between 0.2 and 2.1 percent while Cairn Energy fell 0.6 percent.
Mid-cap Heritage Oil was 5.7 percent higher on news it had entered a preliminary deal to merge with Genel Energy International, a unit of Turkey's Cukurova Group, creating a Kurdish-focused group worth around $5.5 billion.
Higher commodity prices lifted some mining shares with Antofagasta, Eurasian Natural Resources, Rio Tinto up between 0.5 and 1.5 percent. However Kazakhmys, Anglo American, Lonmin and BHP Billiton fell 0.4-0.8 percent.
Shares in Lloyds Banking Group rose 3.1 percent after sharp falls on Monday on speculation the bank will cut some 1,400 jobs and close all branches of its Cheltenham & Gloucester mortgage unit.
The bank said on Monday it will repay about 2.6 billion pounds ($4.1 billion) to the UK government.
Barclays also bounced back after falls on Monday, gaining 1.1 percent. On Monday Barclays confirmed it is in talks to sell Barclays Global Investors, with U.S. fund manager BlackRock the frontrunner to land the asset manager for about $12 billion.
Standard Chartered and Royal Bank of Scotland were up 0.4 and 1.4 percent respectively, but heavyweight HSBC fell 1.5 percent as traders cited concerns that a major stakeholder may need to place shares.
POLITICAL JITTERS
Political uncertainty over support for Prime Minister Gordon Brown has dented market sentiment. However Brown beat off a challenge to his authority on Monday, winning over Labour members of parliament after admitting mistakes and taking responsibility for a week of political turmoil.
House prices in England and Wales fell at their slowest annual pace in 1-1/2 years in the three months to May and completed sales hit a nine-month high in a sign the market may be over the worst, a survey showed on Tuesday.
"This supports the theory the worst is behind us in the housing sector," said Omer Bhatti, head sales trader at spread betters WorldSpreads.
"And with the time taken for interest rate cuts in the last year to finally trickle through into the market and lending finally loosening up from the credit freeze these figures should only get better in the following months."
British retail sales fell in May, as stores struggled to match strong gains booked last year, a survey by the British Retail Consortium showed on Tuesday.
Meanwhile, British companies expect to keep cutting jobs in the next three months, but the pace of job shedding appears to be easing in some sectors, a survey showed on Tuesday. (Editing by David Cowell)