UPDATE 2-London stocks slump on further coronavirus lockdowns, Brexit uncertainty

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* Government sets stricter curbs in northern England
* EU to keep trade talks with Britain alive
* Marston's slips as new restrictions force job cuts
* Recruiter Hays slides on lower quarterly net fees
* FTSE 100 down 1.7% FTSE 250 drops 0.6%

(Updates to close)
By Devik Jain
Oct 15 (Reuters) - London's FTSE 100 fell to a near-two week
low on Thursday as concerns over new coronavirus restrictions
and Brexit-related uncertainty prompted investors to book
profits after a rally earlier in the month.
After slumping as much as 2.5% during the session, the
blue-chip index .FTSE closed down 1.7% to mark its biggest
daily decline since late September, with energy .FTNMX0530 ,
insurance .FTNMX8570 and mining .FTNMX1770 stocks leading
declines.
The mid-cap FTSE 250 .FTMC fell 0.6% with London set to
enter a tighter COVID-19 lockdown from midnight on Friday as
Prime Minister Boris Johnson seeks to tackle a swiftly
accelerating second coronavirus wave. "The issue is what it will actually do to the economy, and
the fact that the UK is sort of backtracking on the progress
that's been made is not a good sign for the economic recovery,"
said Greg Swenson, founding partner of Brigg Macadam, a
London-based investment bank.
After tracking gains in global equities for two straight
weeks on hopes of more U.S. stimulus, UK stocks have also come
under pressure this week as a Brexit trade deal remains elusive.
European Union leaders agreed to extend Brexit trade talks
for few weeks on Thursday, but also called for no-deal
preparations should the troubled negotiations fail. "Markets don't like uncertainty and the fact that a no deal
Brexit is looking like a possibility here is not good," Swenson
said.
Pub operator Marston's Plc MARS.L shed 1.4% as it
announced job cuts due to the tiered-restrictions. In company news, recruitment agency Hays Plc HAYS.L fell
1.3% after posting a 29% drop in its first-quarter net fees due
to the coronavirus crisis. Business supplies distributor Bunzl Plc BNZL.L and
Britain's biggest retailer Tesco Plc TSCO.L lost 2.4% and 3%
in ex-dividend trading.
However, AO World Plc AO.L surged 30.7% after the online
electricals retailer said it expect a 57% increase in first-half
revenue on strong consumer demand during the COVID-19 pandemic.