UPDATE 2-UK stocks retreat as weak U.S. data adds to global growth fears

* FTSE 100 down 0.7%, FTSE 250 dips 0.3%
* Weak factory data from the U.S. weigh on sentiment
* Ferguson rises after FY results
* Greggs tumble after trading update

(Adds news items, analyst comment, updates to closing prices)
By Yadarisa Shabong and Muvija M
Oct 1 (Reuters) - UK stocks retreated on Tuesday, reversing
gains from earlier in the day, coming under pressure following
disappointing manufacturing data from the United States that
added to concerns about the health of the global economy.
The FTSE 100 .FTSE lost 0.7% and a sub-index of banks
.FTNMX8350 fell more than 1%. The main index still
outperformed the benchmark European bourse .STOXX that was
already rattled by weak factory activity data from the euro
zone.
The FTSE 250 .FTMC ended 0.3% lower led by a steep fall in
baker Greggs after a trading update. The index had risen earlier
in the session when hopes rose of a Brexit solution as Prime
Minister Boris Johnson prepared to present his amended proposals
on the divorce deal.
The losses were triggered by data showing the U.S.
manufacturing sector shrinking last month to its weakest level
in more than a decade as business conditions deteriorated amid
the trade war with China.
"Traders had gotten used to the idea that manufacturing in
Europe is weak, but the disappointing U.S. ISM (Institute for
Supply Management) manufacturing report sent the message home it
is a worldwide problem," CMC Markets analyst David Madden said.
Asia-facing financials HSBC HSBA.L and Standard Chartered
STAN.L , which were already lower on the day as the Hong Kong
protests intensified, extended losses after the disappointing
U.S. data.
AstraZeneca AZN.L also weighed on UK's main index with a
near 2% drop after the U.S. Food and Drug Administration
declined to approve the company's combination therapy to treat
smoker's lung.
Piling on worries about global growth, the World Trade
Organisation earlier in the day cut its growth forecast for
global trade this year by more than half, adding that an
escalation in trade tensions, a slowing global economy and a
disorderly Brexit could squeeze growth even more.
The stock markets' shaky start to October comes ahead of the
resumption in Sino-U.S. trade talks next week, when the world's
two biggest economies will try to resolve their conflicts.
The trade spat has so far roiled financial markets this
year, causing the FTSE 100 to suffer its biggest monthly drop in
2019 in August when tensions flared up.
Among a handful of gainers was Ferguson FERG.L , which rose
more than 4% in its best day since June after the plumbing parts
distributor posted a better-than-expected rise in earnings
thanks to cost-cutting moves.
Fund supermarket Hargreaves Lansdown HRGV.L dropped 3.5%
as Credit Suisse initiated rating on the stock with an
"underperform".
Mid-cap Greggs GRG.L slumped nearly 12% after the takeaway
food group reported a slowdown in sales growth, while Integrafin
IHPI.L slipped 4.8% after its co-founder trimmed his stake.