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UPDATE 2-Travel, energy stocks drag UK shares lower, weighed by coronavirus fears

(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window)

* Surge in coronavirus cases dents mood

* EU negotiator Barnier extends London visit for Brexit talks

* AstraZeneca gains on positive COVID-19 vaccine update

* Coca-Cola European Partners rise on buyout offer

* FTSE 100 down 1.2%, FTSE 250 drops 1.4% (Adds comment; updates to close)

Oct 26 (Reuters) - London stocks closed sharply lower on Monday, weighed by travel and energy stocks, while a resurgence in novel coronavirus cases stoked fears of a faltering economic recovery and dragged down European markets. After rising nearly 0.1% in morning trade, the blue-chip FTSE 100 index fell 1.2%, led by declines in travel and leisure, personal goods makers, retailers and aero stocks.

Energy and mining weighed the most on the index due to weaker commodity prices.

The domestically focussed mid-cap FTSE 250 index lost 1.4% even as European Union chief negotiator Michel Barnier and his team extended their London visit until Wednesday to try and clinch a Brexit trade deal.

European markets were weighed down by a plunge in tech major SAP, an impasse over the U.S. stimulus package and fears that a resurgence in coronavirus cases could hamper a global economic recovery as governments tighten restrictions on businesses and social activity.

“The fact that (more) countries are now reining in the freedom of people to move around is going to have a detrimental impact on the actual overall activity level in the economy”, said Saxo Bank chief investment officer Steen Jakobsen.

“UK is even more challenged due to the COVID-19 close-down and Brexit.”

After a stimulus-backed rally from pandemic lows, the FTSE 100 has been trading in tight ranges since June due to Brexit-related uncertainty and concerns over coronavirus curbs.

In a bright spot, AstraZeneca Plc rose 1.7% after the drugmaker resumed the U.S. trial of its experimental COVID-19 vaccine that is being developed with the University of Oxford, and said it produced a similar immune response in both older and younger adults.

The wider healthcare index added 1%.

Educational publisher Pearson Plc added 3% after UBS upgraded the stock to a “buy” rating.

Coca-Cola European Partners (CCEP) rose 0.3% after the soft drink bottler made a buyout offer of $6.6 billion for its Australian peer Coca-Cola Amatil Ltd. (Reporting by Devik Jain in Bengaluru; editing by Aditya Soni and Bernadette Baum)

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