By Sagarika Jaisinghani and Susan Mathew
(Reuters) - London-listed shares fell on Friday as travel stocks tumbled after Britain imposed new quarantine measures on travellers from France and other countries, while disappointing data from around the world raised worries of a delayed global economic rebound.
The blue-chip FTSE 100 <.FTSE> fell 1.6% and the mid-cap FTSE 250 <.FTMC> lost 1.1%, with the travel index <.FTNMX5750> marking its sharpest loss in two weeks as France warned that it would reciprocate.
British Airways owner International Consolidated Airlines <ICAG.L>, budget carrier easyJet <EZJ.L> and the London shares of tourism company TUI <TUIT.L> lost between 4.8% and 8.4%.
"This comes just as the travel and tourism sector was starting to get back on its feet after being decimated by the (novel coronavirus) pandemic," said Craig Erlam, senior market analyst, UK & EMEA at OANDA.
Any reciprocation would mean that UK businesses that rely on tourists from France and others in the list such as the Netherlands and Malta, will also suffer, he said.
UK Prime Minister Boris Johnson resumed Britain's lockdown easing but stiffened punishments for rule breaches including increasing fines for repeatedly refusing to wear face masks, and cautioned he would halt the easing again if needed.
Losses in London indexes were broad-based as falling crude prices weighed on oil majors <.FTNMX0530>, while a strong pound hurt internationally focused firms on the FTSE 100.
Global sentiment, meanwhile, took a hit as an unexpected slip in China retails sales was followed by U.S. retails sales rising less than expected in July. In the euro zone, data confirmed the bloc suffered the biggest drop ever recorded in employment and gross domestic product in the second quarter.
But, the FTSE 100 logged its second straight weekly gain, up 1%, as growing evidence of the pandemic's economic and corporate damage brews optimism around more stimulus.
Citigroup analysts said they expected dividends issued by UK firms to drop 50% this year, although miners could outperform if commodity prices showed resilience in the second half.
(Reporting by Sagarika Jaisinghani in Bengaluru, Editing by Subhranshu Sahu and David Evans)