Travel and leisure shares weigh on European equities

LONDON, April 29 (Reuters) - European equities fell sharply in early trading on Friday, with British Airways-owner International Airlines Group and Restaurant Group (Other OTC: RSTGF - news) dragging the travel and leisure index lower after their updates.

IAG shares fell more than 3 percent after reporting a forecast-beating rise in first-quarter profit, but said that it would moderate its capacity expansion in the short term in response to weaker overall demand.

Britain's Restaurant Group, which operates chains like Chiquito and Frankie & Benny's, slumped 19 percent after warning on full-year profit outlook.

The STOXX Europe 600 Travel and Leisure index fell 2 percent, the top sectoral decliner.

The pan-European FTSEurofirst 300 index, which hit a three-month high last week, was down 1.3 percent by 0717 GMT.

(Reporting by Atul Prakash)