* FTSE 100 down 0.5 pct; FTSE 250 at Dec 2016 lows
* Nerves build before Tuesday's parlimentary vote
* Utilities, Royal Mail fall on general election worries
* Interserve tanks to new record low
By Danilo Masoni
MILAN, Dec 10 (Reuters) - British shares fell on Monday as concerns over slowing economic growth hit global stocks and investors braced for a crucial vote on Tuesday over Prime Minister Theresa May's Brexit deal.
The UK Parliament is expected to reject her divorce deal, heightening political tension in Europe's second largest economy and perhaps paving the way for a general election.
"Given the way political risk is starting to be priced into the market, we could see further losses if, or rather when, the prime minister loses her Brexit vote," said Neil Wilson, Chief Market Analyst at Markets.com.
"Whilst a weaker pound could offer some support, a very high political risk premium would tend to trump that and drag the market lower. Investors will have to start, if they haven't already, to price in the risk of a general election and Labour-led government," he added.
Analysts say that a Labour-led government and a threat of a nationalisation of utilities would put further pressure on the sector.
Royal Mail RMG.L , recently demoted from the FTSE 100, also fell 2.7 percent.
"Remember that Labour had previously threatened to nationalise utilities and Royal Mail, so investors may be starting to price in a higher likelihood of a general election in the near future and for Labour to have a strengthening hand," said Russ Mould, investment director at AJ Bell.
Traders said Centrica was also penalised after a Sunday Telegraph reported that the owner of Britain's largest energy supplier British Gas could struggle to pay dividends.
Housebuilders, which are also highly sensitive to Brexit developments, were broadly lower as tension built and analyst at Peel Hunt cut their ratings and price targets. in Berkeley Group BKGH.L , Persimmon PSN.L , Taylor Wimpey TW.L and Barratt Development BDEV.L fell between 0.4 and 1.6 percent.
Shares in pension provider Just Group JUSTJ.L rallied 22 percent, set for its best day ever, following a policy announcement from the Bank of England's regulatory body that proposed changes in rules over lifetime mortgages. appears a good announcement for Just Group and removes a considerable amount of the uncertainty faced by shareholders," said Numis in a note.
Among the few gainers were shared in precious metal miner Randgold RRS.L , which was lifted 1.7 percent as investors sought refuge in safe haven assets such as gold.
Shares in Interserve IRV.L plunged 52 percent to fresh record lows after the embattled British outsourcer announced a rescue plan that envisaged converting much of its debt into new shares, potentially handing control of the company to its creditors.
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