UPDATE 2-Brexit worries hit domestic stocks but sterling slide lifts FTSE 100

By Muvija M and Yadarisa Shabong

* FTSE 100 up 0.1%, FTSE 250 down 0.7%

* Exporters top boost to main index

* Brexit-sensitive stocks slip

* M&S slumps after discounted offering

* IG gains on new growth plan, boosts peers (Adds company news items, updates to closing prices)

By Muvija M and Yadarisa Shabong

May 22 (Reuters) - Brexit sensitive housebuilders and airlines slid on Wednesday as rumors circulated that ministers could oust Theresa May after her latest EU exit plan failed to win support, while exporters lifted the FTSE 100 as the pound weakened.

The main index, whose companies earn more than two-thirds of their profit from abroad, ended 0.1% higher, while the more domestically-focused FTSE 250 slipped 0.7%.

A slump in sterling lifted internationally-exposed companies GlaxoSmithKline, Unilever and AstraZeneca , the biggest boosts to the FTSE 100.

The index outperformed world stocks, where confidence was hit by renewed worries over the Sino-U.S. trade standoff after reports the United States is considering sanctions on Chinese video surveillance firm Hikvision.

Stocks most sensitive to the any increased risk of a hard Brexit stumbled after multiple media reported rumors May's ministers could oust her in a row over her latest deal to exit the European Union.

Blue-chip housebuilders such as Persimmon, Taylor Wimpey and Barratt lost between 5.5% and 4.5%, while easyJet was down 5.8%.

Packaging firms were the biggest gainers on the main bourse after Mondi raised container-board prices, according to traders, while M&S was the biggest loser.

The retailer slumped 9.4% to a more than four-month low after it priced a rights issue at a big discount to Tuesday's close. It also reported a third straight decline in annual profits, emphasizing the pain of its latest turnaround plan.

SSE slipped 3.5% after reporting a fall in annual earnings and warning of an uncertain outlook due to the opposition Labour party's plans to renationalise energy networks should they win an election.

Despite some strong earnings reports, the midcap index found itself in the red as concerns over Brexit ratcheted up again, with consumer stocks and industrials leading the way lower.

After announcing a plan to drive growth, financial trading platform IG Group surged 12.5% despite forecasting a drop in full-year net trading revenue and operating profit.

That helped rivals Plus500 and CMC Markets to gain 6.4% and 3.7% respectively.

Metro Bank advanced 15.2% a day after the lender escaped a potential investor challenge at its annual meeting, although there were sizeable votes against several of its most senior directors.

Pets at Home jumped 14% after reporting better-than-expected revenue and forecasting higher earnings for 2020.

Engineering services group Babcock weighed on the index, tumbling 9.3% to an 8-1/2-year low after saying it expected revenue and underlying operating profit to fall in 2019/2020.

(Reporting by Muvija M and Shashwat Awasthi in Bengaluru; Editing by Andrew Heavens, Mark Potter and Kirsten Donovan)