* Barclays jumps on strong quarterly profit * UK’s economic recovery fades in Oct. as pandemic flares up * IHG slips on plunge in Q3 room revenue * FTSE 100 rises 1.3%, FTSE 250 adds 1.2%, (Adds comment; updates to close) Oct 23 (Reuters) - London stocks jumped on Friday, boosted by upbeat Barclays’ earnings and rising hopes of a Brexit trade deal before year end, but the blue-chip FTSE 100 still logged its second weekly decline on concerns over fresh coronavirus restrictions. The FTSE 100 index closed up 1.3%, with shares in the British lender jumping 7% as its consumer businesses swung back to profit and provisions against bad loans fell in the third quarter. The wider banks sub-index added almost 5% with gains in energy, homebuilder and aero stocks also helping the blue-chip index outperform regional peers. The domestically-focussed mid-cap FTSE 250 index, considered a barometer for Brexit sentiment, ended 1.2% higher after Reuters reported France is laying the ground for a compromise on fisheries, one of the key sticking points in trade negotiations between the European Union and Britain. “There is a renewed enthusiasm to talk again. Perhaps there will be concessions made and if there is some kind of agreement going forward, that increases the chances of a deal,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown. However, the blue-chip index still suffered a second straight weekly loss on concerns over new coronavirus-led curbs as cases surged, and Brexit trade deal-related uncertainty, with data also pointing towards a faltering economic recovery. The UK’s composite PMI fell to a four-month low of 52.9 in October, while consumer morale tumbled to its lowest level since late May, surveys showed on Friday. “Today’s UK data paint a picture of an economic recovery that is now clearly at risk of losing steam,” said Hugh Gimber, global market strategist at J.P. Morgan Asset Management. In company news, InterContinental Hotels Group Plc slipped 1.5% after the Holiday Inn-owner posted a plunge in third-quarter hotel room revenue (RevPAR). (Reporting by Devik Jain in Bengaluru; editing by Uttaresh.V)