UPDATE 2-Trade worries hit FTSE 100, banks slip on BoE plan

* FTSE 100 down 0.5%, FTSE 250 down 0.6%
* Trade worries extinguish earlier rally
* Centrica drops to lowest since Aug. 1998
* CYBG drags on mid-cap index after results

(Adds news items, analyst comment, closing prices)
By Shashwat Awasthi
July 30 (Reuters) - London's FTSE 100 index ended lower on
Tuesday, giving up earlier gains as the mood soured in response
to worries over U.S.-China trade and as major British banks fell
after the Bank of England issued a new plan to handle potential
banking crises.
The main index .FTSE shed 0.5%, but remained close to the
near 11-month highs hit earlier after BP's BP.L stronger than
expected profit.
The mid-cap FTSE 250 .FTMC fell 0.6%, dragged down in part
by a near 10% drop in Virgin Money-owner CYBG CYBGC.L .
The blue-chip index followed Wall Street lower after U.S.
President Donald Trump warned China not to wait for the 2020
U.S. presidential election to make a trade deal. Big British banks, such as Barclays BARC.L and RBS
RBS.L , fell after the BoE said banks would have to tell
investors in 2021 if they could be closed down without
disrupting financial markets. EARNINGS DOMINATE
Corporate earnings were the main drivers behind most of the
major stock moves on both UK indexes.
British Gas parent Centrica CNA.L , whose earnings have
been hit by a national cap on energy prices, dropped 19% to its
lowest level in more than two decades as it cut its dividend and
said its chief executive would step down. "The company needs a new leader to take a grip of things...
It's in the middle of a big changes in the sector and a
significant restructuring so slashing the dividend whilst cash
flow is uncertain is absolutely vital," Markets.com analyst Neil
Wilson said.
Fresnillo FRES.L fell nearly 18% after its profit dropped
by more than two-thirds in the first half of the year due to a
drop in production and higher costs. Shares in some major exporting companies were unable to
capitalise on sterling's plunge on no-deal Brexit worries.
Reckitt Benckiser RB.L fell 3.2% after cutting its annual
revenue outlook, while tobacco stocks skidded after U.S.-based
Altria MO.N forecast a steeper decline in industry cigarette
volumes. Mid-cap CYBG slipped 9.6% after it forecast its net interest
margin would be at the lower end of its earlier view.
British Airways owner IAG ICAG.L fell 5.4% on the main
index, while mid-cap peers Wizz Air WIZZ.L and easyJet EZJ.L
shed 4.1% and 5.6% respectively, after Germany's Lufthansa
LHAG.DE warned of a challenging European market in the near
term.