By Carla Mozee, MarketWatch Burberry lifted by an analyst upgrade

LONDON (MarketWatch)--U.K. stocks ended slightly lower Wednesday, with travel stocks hurt as Thomas Cook Group PLC shares lost nearly one-fifth of their value after a downbeat trading outlook, but the potential for a deal at BT Group PLC lifted shares of the telecom company.

On the economic front, data from the Office for National Statistics confirm the U.K. economy grew at a rate of 0.7% in the third quarter, in line with its preliminary estimate.

While the GDP figure also met market expectations, "if we look at the data more closely we will see that the economy is consuming more and still exposed to external shocks as the export figures have decreased," wrote Naeem Aslam, analyst at Ava Trade, in a note.

The pound briefly came under pressure after the GDP report, but "hopes are still building up for an interest-rate rise [in the U.K.] once again," he said.

The pound slipped (GBPUSD) after the GDP report but recovered ground as the session wore on, buying $1.5793 compared with $1.5706 before the data were released. The dollar came under pressure after a round of weak U.S. economic data.

Stocks: The FTSE 100 slipped 2 points to close at 6,729.17.TUI Travel PLC logged the sharpest loss, losing 2.1%, while shares of budget air carrier easyJet PLC fell 1% and cruise-line operator Carnival PLC ended 1.1% lower.

The moves came as Thomas Cook shares plunged 17.7% on the midcap FTSE 250 index . The selloff was triggered after the company said it foresees a more moderate pace of growth this year because of a tougher trading environment. At the same time, Thomas Cook said Chief Executive Harriet Green will step down effective immediately and be replaced by Chief Operating Officer Peter Fankhauser.

A reset of fiscal year 2015 expectations by Thomas Cook "is disappointing and the CEO change is surprising," said Jefferies analysts Mark Irvine-Fortescue and Ian Rennardson in a note. "But standing back from it all, we remain confident in the turnaround prospects and believe an inflection point is not far away, driven by better hotel and airline yield management and further digitisation of the business."

On the upside, shares of BT tacked on 2.2% as mobile operator EE said it's holding exploratory talks with BT, although it's too early to say whether a transaction will materialize. The confirmation from EE comes after BT said Monday it's discussing the possibility of purchasing O2, the U.K. mobile arm of Spain's Telefonica SA .

Shares of rival U.K. mobile services operator Vodafone PLC rose 0.5%.

Also higher were shares of Burberry , rising 0.3% after the luxury-goods maker was upgraded to a buy rating, from neutral, at Nomura. "Customer service and top-line growth look set to continue, with beauty providing an accessible entry" to the brand, wrote European luxury-goods analysts Christopher Walker and Anand Vaidya.

Nomura upgraded the overall luxury-goods sector to bullish, citing an increased focus on productivity and an attractive cash-adjusted valuation. See what analysts are saying about Burberry, Luxxotica and others in the luxury-goods sector.

Investors on Thursday will look for a decision from the Organization of the Petroleum Exporting Countries meeting on whether the group will cut production at a time of oversupply in the market and as crude futures trade at their lowest level in four years.

Ahead of the meeting, shares of oil producer BP PLC closed 1% lower and Tullow Oil PLC shed 0.1%. Royal Dutch Shell PLC shares closed up 0.4%.

In other developments, the U.S. Justice Department is investigating allegations that an employee at British banking heavyweight HSBC Holdings PLC (HSBC) in 2010 leaked confidential client information to a prominent New York hedge fund. The probe is part of a larger criminal investigation into possible manipulation in the currency market.

Shares of HSBC turned 0.4% lower in London trade.

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