UPDATE 2-FTSE 100 retreats as recovery hopes dim, trade worries resurface

* UK economy shrinks but pace of slide eases in May -PMI
* Rising U.S.-China trade tensions weigh on mood
* Premier Inn owner declines after saying it will seek cash
* EasyJet rises on plan to resume some flights in June
* FTSE 100 down 0.9%, FTSE 250 up 0.1%

(Adds comments, updates prices to close)
By Shreyashi Sanyal and Devik Jain
May 21 (Reuters) - London's FTSE 100 ended lower on Thursday
as optimism faded about any speedy recovery from the
coronavirus-induced economic slump, while U.S.-China trade
tensions returned firmly to the forefront of investors' minds.
The export-heavy FTSE 100 .FTSE slipped 0.9%, taking the
shine off strong gains earlier in the week. However, the mid-cap
FTSE 250 .FTMC narrowly extended gains to a fifth day with a
0.1% rise.
Grim economic data continued to pour in; the UK economy
shrank again in May, but at a slower pace than April, a survey
by IHS Markit showed. Risk appetite was also hindered by rising tensions between
Washington and Beijing over China's handling of the coronavirus
outbreak. U.S. Secretary of State Mike Pompeo on Wednesday
called China's $2 billion pledge to fight the pandemic "paltry".

"The questioning around globalization is going to come to
the fore again, simply because now we're seeing this escalation
in the trade war again," said Stephen Innes, chief global market
strategist at AxiCorp.
Banks .FTNMX8350 , oil and gas .FTNMX0530 and miners
.FTNMX1770 were the biggest decliners among sector indices.
After rallying about 23% since late March on a raft of
global stimulus and, more recently, the easing of COVID-19
lockdowns, the FTSE 100 is now about 22% below its January
record high.
Premier Inn owner Whitbread Plc WTB.L sank 13.4% to a
two-month low after it said it would seek 1.01 billion pounds
($1.2 billion) in fresh cash from shareholders to help weather
the COVID-19 crisis.
Car dealer Inchcape Plc INCH.L fell 7.7% as it posted a
slump in April revenue and said the global economic impact of
the lockdowns would be felt until 2021. British low-cost airline easyJet EZJ.L climbed 4.4% as it
said it would restart a small number of flights on June 15.