UPDATE 2-FTSE 100 hits 8-month low as global slowdown fears take hold

* FTSE 100 down 0.6%, FTSE 250 down 0.7%
* Weak U.S. services data weighs
* U.S. tariffs on European Union goods dampen sentiment
* Blue-chip index tracking worst week more than 1-1/2 years
* Ted Baker sinks after profit warning

(Adds news items, analyst comment, updates to close)
By Yadarisa Shabong and Shashwat Awasthi
Oct 3 (Reuters) - Britain's FTSE 100 index touched an eight
month low on Thursday after sluggish U.S. services data cemented
fears of a global slowdown triggered by a string of weak
manufacturing data, while the UK appeared to have tipped into a
recession.
UK stocks lagged their European peers and Wall Street, with
the main index .FTSE , which suffered its worst one-day drop
since before the 2016 Brexit referendum on Wednesday, ending
0.6% lower. Energy stocks Shell RDSa.L and BP BP.L were the
biggest drag as oil prices fell on the same worries about the
global economy. O/R
The mid-cap FTSE 250 .FTMC slipped 0.7% to its lowest in
more than a month after data showed the UK services sector
unexpectedly shrank last month as the country's exit from the
European Union dragged on. On the blue-chip index, stocks trading ex-dividend added
downward pressure, with packaging firm DS Smith SMDS.L ,
tobacco firm BAT BATS.L , ad firm WPP WPP.L , housebuilder
Taylor Wimpey TW.L and retailer Kingfisher KGF.L dropping
between 2.4% and 5.7%.
A slew of shockingly weak U.S. economic data, lingering
fears over the Sino-U.S. trade dispute and heightened no-deal
Brexit jitters have spooked traders this week, and the World
Trade Organization's approval of U.S. tariffs on European goods
has further fanned fears. "With markets already looking vulnerable over concerns about
a manufacturing recession starting to bleed into a slowdown in
the services sector, the WTO ruling could not have come at a
worse time," CMC Markets analyst Michael Hewson said.
Those fears were exacerbated after data showed growth in the
world's largest economy's services sector slowed to its most
anaemic pace in three years last month.
However, increasing bets that the U.S. Federal Reserve would
cut interest rates for the third time this year later this month
helped the FTSE 100 recoup some losses later in the session.
"We do not see this early fourth quarter weakness as
heralding the end of the equity bull market, however the central
bank reaction to declining U.S. data will be key for equities
going forward," said Edward Park, Deputy Chief Investment
Officer at investment manager Brooks Macdonald.
The globally-exposed FTSE 100 is headed for its steepest
weekly fall in more than one-and-a-half years.
Notable movers included Ted Baker, which posted its biggest
ever one-day decline, slumping 40% to a nine-year low after
reporting a first-half pre-tax loss and warning that
unseasonably warm weather, heavy discounting by rivals and weak
consumer demand would hit full-year profit. Online trading platform CMC Markets CMCX.L climbed 7.7%
after it forecast a jump in annual earnings. Mid-cap gold miner Centamin CEY.L lost nearly 10% after
issuing a production forecast for the third quarter and saying
its chief executive officer would retire.