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FTSE 100 down 0.9%, FTSE 250 down 1%

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Financial stocks slump

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Industrial stocks fall tracking European counterparts

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Pearson jumps on stronger growth forecasts

(Updates to market close)

Oct 17 (Reuters) - London's benchmark index hit a

two-week low on Friday, weighed down by losses in heavyweight

lenders that joined a global selloff in financial stocks on

concerns over the health of U.S. regional banks.

The benchmark FTSE 100 ended down 0.9% at 9,353

points. Though off its session lows, the index still concluded

its second consecutive week in the red.

The domestically focused FTSE 250 dropped 1% to

21,783, barely changed for the week.

The banks index shed 3.1%. HSBC ( HSBC ),

Barclays ( BCS ) and Standard Chartered ( SCBFF ) fell 3%, 5.4%

and 3.2% respectively.

Concern about credit quality in U.S. regional banks rippled

through markets on Friday, reviving memories of the crisis of

confidence that shook sentiment just over two years ago.

Wall Street's losses were contained after U.S. President

Donald Trump said his proposed 100% tariff on goods from China

would not be sustainable, easing investor nerves after tensions

flared between the two sides over Beijing's move to tighten

control over rare earth exports.

Britain's economy returned to growth in August, data on

Thursday showed. Separately, the International Monetary Fund

this week said Britain's economy is on course for the

second-fastest growth among the Group of Seven nations in 2025

after the United States.

Defensive sectors were among those in positive territory

with personal goods, beverages,

personal care, drug & grocery and utilities

, reflecting the cautious mood among investors.

The aerospace and defense index dropped 3.5%,

tracking losses in European counterparts.

Among other movers, precious metal miner Fresnillo

slumped 11% as gold and platinum prices tumbled.

Pearson gained 2.5% to the top of FTSE 100 as the

education company expects stronger sales growth in the fourth

quarter.

Man Group ( MNGPF ) gained 6.3% after the hedge fund's growth

in assets under management surpassed expectations.