* FTSE flat, U.S. market closed for holiday
* BP deal with Rosneft boosts demand for energy stocks
* Smiths and S&N lifted by M&A hopes
By David Brett
LONDON, Jan 17 (Reuters) - Britain's top share index was flat on Monday, supported by BP's tie-up with Russian group Rosneft which offset weaker mining stocks.
By 1158 GMT, the FTSE 100 was up 0.68 point at 6,002.75, having closed down 0.4 percent on Friday.
Technical analysts said recent movements on the FTSE 100 suggest a more bearish outlook in the short term.
"The index is now testing its 20 Day Moving Average (5,978.52, according to Thomson Reuters data), which may support the index but momentum is clearly showing signs of weakness suggesting bearish moves are likely," Sandy Jadeja, chief technical analyst at City Index, said.
Jadeja said a break below 5,950 could see the index trade down towards 5,707, if weakness starts to set in.
BP rose 1.5 percent, adding most points to the index after it agreed a $7.8 billion share swap with Rosneft, Russia's top oil producer, late on Friday that will give the UK company access to areas of the Arctic previously reserved for Russian oil companies.
The deal helped lift sentiment in the energy sector.
British engineering firm Smiths was the top gainer in percentage terms, up 8.1 percent after rebuffing a 2.45 billion pound ($3.88 billion) cash bid approach for its medical services unit late on Friday.
"We're hearing that Apax have made a bid and that other people are in the background, so the price could be pushed higher," a London-based trader in the stock said.
DEAL TALK BOOSTS S&N
British artificial knee and hip maker Smith & Nephew (S&N) climbed 3.9 percent after a weekend report that Johnson & Johnson was considering a fresh takeover approach worth at least 800 pence a share, which would value S&N at 7.12 billion pounds ($11.3 billion).
Vodafone Group added 1.6 percent as investors await a deal for the British firm to dispose of its 44 percent stake in French mobile operator SFR for between 7 to 8 billion euros.
Burberry rose 0.6 percent, fuelled by optimism ahead of a trading update on Tuesday after Swiss peer Richemont recorded double-digit growth in all business areas.
On the downside, exploration equipment maker Weir Group shed 1.5 percent, with traders citing talk of a potential bid for Swiss engineering group Sulzer.
Miners remained hamstrung by concerns over demand from China after the world's biggest consumer of raw materials announced it was raising banks' required reserves by another 50 basis points on Friday, a further sign of monetary policy tightening.
"China is the powerhouse of demand and the economic situation there is attracting a lot of attention, even though its situation is one that most other countries would give an arm and a leg for," Richard Hunter, head of UK equities at Hargreaves Lansdown, said.
Investors locked in profits on banks, which have enjoyed a good start to 2011 despite Europe's sovereign debt problems lingering in the background.
The U.S. market was closed on Monday for the Martin Luther King Jr Holiday.
(Editing by David Cowell)