UPDATE 2-British midcaps rise on optimism over Brexit-trade deal

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* UK-EU agree to intensify Brexit-trade negotiations
* Moody's cuts UK debt rating on COVID-19, Brexit hit
* Amigo slips on new curbs for asset transfer
* FTSE 100 down 0.6%, FTSE 250 up 0.2%

(Adds analyst comment; updates to close)
By Devik Jain
Oct 19 (Reuters) - British midcaps edged higher on Monday on
signs that Brexit-trade talks between the UK and European Union
were intensifying, although gains were capped due to concerns
over tougher business restrictions in Britain.
The FTSE 250 index .FTMC , considered a barometer for
Brexit sentiment, closed 0.2% up, boosted by shares of flexible
office space provider IWG Plc IWG.L which jumped 5% after
Berenberg upgraded the stock to "buy."
Britain and the EU agreed on Monday to intensify trade talks
and work on legal texts, a breakthrough of sorts after Prime
Minister Boris Johnson said he would walk away from negotiations
that had been deadlocked for weeks. UK markets came under pressure last week as political
wrangling over new coronavirus-induced lockdowns across parts of
England and uncertainty about a post-Brexit trade deal sapped
demand for equities.
After rising nearly 0.7% in early trading, the blue-chip
FTSE 100 index .FTSE ended 0.6% lower, dragged down by shares
of Reckitt Benckiser RB.L , pharmaceutical .FTNMX4570 and
personal goods maker .FTNMX3760 stocks, while a stronger pound
also pressured exporters. /GBP
"The Brexit situation is incredibly volatile and getting
closer to December 31 means that there is still quite a lot a
big question marks around what Brexit is ultimately going to
entail even though we're only two and a half months away," said
Bert Colijn, a senior economist at ING.
Wales will impose a two-week "fire-break" lockdown from
Friday to combat an accelerating second wave of COVID-19.

Ratings agency Moody's cut the United Kingdom's debt rating
last week, while Bank of England Governor Andrew Bailey warned
of a significant risk of further disappointments to domestic
economic growth. Amigo Holdings Plc AMGO.L tumbled 10.6% after saying it
had entered an Asset Voluntary Requirement (AVR) with Britain's
financial watchdog, meaning the subprime lender will need
approval to transfer assets outside of the group.