(Corrects bullet 4 to say FTSE 100 ended up, not down)
* HSBC slips after UK regulator imposes fine
* Oil stocks hit as crude weakens
* Retail sales 4.7% higher than a year earlier
* FTSE 100 up 0.1%, FTSE 250 adds 0.6%
Dec 17 (Reuters) - UK's exporter-heavy FTSE 100 ended higher on Friday, helped by a weaker pound, but posted a weekly loss as concerns over the Omicron coronavirus variant and inflationary risks weighed.
The FTSE 100 erased earlier losses to close 0.1% higher, as large dollar earners including Diageo, Unilever, British American Tobacco and Reckitt Benckiser benefited from the sterling falling.
Limiting gains, shares of HSBC shed 0.6% after the UK's financial regulator said it had fined the bank 63.95 million pounds ($85.16 million) for failings in its anti-money laundering processes.
Retailers gained 0.5% after data showed sales rose faster than expected last month, helped by Black Friday discounts, early Christmas shopping and no lockdown restrictions.
That also lifted shares of Marks and Spencer and WH Smith, helping the domestically focussed mid-cap stocks rise 0.6%.
"Some of that strength was because households were bringing forward their Christmas shopping amid worries about shortages, shipping delays, even before Omicron," said Bethany Beckett, UK economist at Capital Economics.
"Still, retailers are positioned to deal with Omicron better than sectors like hospitality."
However, a survey showed consumer confidence was down heading into December as the emergence of Omicron and inflation worries hit spending plans.
Oil majors Royal Dutch Shell and BP fell more than 1% each, tracking weakness in crude prices as surging COVID-19 cases raised fears that new curbs may hit fuel demand.
The Bank of England surprised investors on Thursday, increasing the interest rate by 15 basis points, the first hike since the start of the pandemic, as it seeks to tackle a surge in inflation. (Reporting by Bansari Mayur Kamdar and Amal S in Bengaluru; Editing by Sherry Jacob-Phillips and Vinay Dwivedi)
