Aug 4 (Reuters) - London"s FTSE 100 rose on Wednesday, helped by heavyweight financial stocks and strong corporate earnings updates, although investors" mood remained cautious over rising COVID-19 infections and risks of higher inflation. The blue-chip FTSE 100 index (.FTSE) inched up 0.2%, helped by financial stocks (.FTNMX303010) which gained 1.6% with Prudential (PRU.L), Legal and General (LGEN.L), and Barclays (BARC.L) among the top boosts to the index. Insurer and asset manager Legal & General gained 3.2% and was the third biggest gainer on the FTSE 100 after beating estimates for first-half profit and signalling a strong full year. Taylor Wimpey (TW.L) added 2.2% as it joined bigger rivals in forecasting sustained demand and projected annual operating profit above the top end of market consensus. read more "Higher selling prices, strong forward sales and a rapid recovery in profits at housebuilder Taylor Wimpey in the first half will all help to soothe investors" nerves over what may happen to the UK housing market, as a new "Help to Buy" scheme starts and the stamp duty holiday comes to an end," said Russ Mould, investment director at AJ Bell. Homebuilders (.FTNMX402020) have gained nearly 1% this year on higher demand for homes amid lockdowns and government tax breaks, although a survey last month pointed towards a cooling housing market. read more The FTSE 100 began the month on a strong note and recorded gains for the third straight session, supported by robust earnings and dividend cheer, as investors straddle the fence between inflation concerns and re-opening optimism. The domestically focused mid-cap index (.FTMC) inched 0.1% higher, with travel (.FTNMX405010) and real estate stocks (.FTNMX351020) leading the gains. Among other stocks, British e-commerce company The Hut Group (THG.L) rose 1.4% after it said it would buy UK-based online beauty retailer Cult Beauty for 275 million pounds ($382.91 million). Rolls-Royce (RR.L) gained 1.4% as a Spanish newspaper report said the company is set to sell its Spain-based ITP Aero unit to U.S. private equity firm Bain Capital and Spanish group Sener for 1.6 billion euros ($1.9 billion). read more Reporting by Shashank Nayar and Amal S in Bengaluru; Editing by Kirsten Donovan, Subhranshu Sahu and Uttaresh.V Our Standards: The Thomson Reuters Trust Principles.