* FTSE 100 flat, FTSE 250 down 0.8 pct
* PM wins vote, but relief rally in sterling short-lived
* TUI jumps after results
* Housebuilders drop as Brexit uncertainty returns
* Sports Direct sinks; CEO says trading "unbelievably bad" (Updates prices, adds details, quotes)
LONDON, Dec 13 (Reuters) - Britain's Brexit-sensitive domestic stocks fell on Thursday as investors decided Prime Minister Theresa May's victory in a leadership challenge clarified little in the country's protracted divorce from the European Union.
The mid-cap FTSE 250 index ended the day down 0.8 percent, giving up early gains as worries that a disorderly Brexit would hurt the economy returned. Half of mid-caps' income is generated in the UK.
Weak results from retailers Sports Direct and Bonmarche also dragged the market down, denting investors' appetite for stocks sensitive to slowing consumer spending.
The FTSE 100 ended the day flat with oil and consumer stocks lagging.
The possibility that Britain could quit the EU without an agreement kept many investors on the sidelines. Both the FTSE 100 and 250 are on track for their worst years in a decade.
May survived a no-confidence vote by the Conservative Party on Wednesday night, but more than a third of her lawmakers voted against her, suggesting parliament was heading towards deadlock over Brexit.
"I think this feels a lot more like another step in the long process (towards Brexit). It wasn't a game changer in itself from a global investor perspective," said Lars Kreckel, global equity strategist at Legal & General Investment Management.
Shares in state-supported Royal Bank of Scotland rose 0.9 percent as investors welcomed May's win, which was seen as reducing the chances of a national election.
Housebuilders, however, tumbled, lagging the broader market after early gains. Taylor Wimpey and Persimmon fell 0.6 to 1 percent, and Barratt Development lost 2.8 percent.
The sector has been hit by worries that a hard Brexit will damage the British economy, and a survey of property valuers early on Thursday showed a gauge of house prices hit a six-year low in November.
Housebuilder shares have recently touched their lowest level since the June 2016 Brexit referendum.
London-listed shares in German tour operator TUI climbed 5.3 percent, topping the FTSE 100. The travel company reported better-than-expected annual earnings and forecast a robust year with strong margins in its hotel and cruise business.
TUI shares recouped some ground lost in recent weeks after rival Thomas Cook delivered another profit alert. Thomas Cook also saw a small bounce, up 2 percent.
Retailers were the worst hit across the market.
Sports Direct shares tanked, falling 13 percent after the retailer reported weak results and CEO Mike Ashley said trading in November was "unbelievably bad", highlighting a growing sense of gloom among British high streets in the peak Christmas season.
The stock had its worst day since June 24, 2016 when the Brexit vote sank markets.
"Today's figures were solid given the circumstances but we have run out of patience with the lack of visibility on strategy," wrote Peel Hunt analysts, downgrading their recommendation on the stock to Hold from Add.
"Clearly current trading is very poor, as it is everywhere."
Shares in women's fashion retailer Bonmarche collapsed 47.2 percent, their worst ever day, after the firm said it could report losses and was faring much worse than during the 2008/09 financial crisis.
FTSE 100 retailers Next and Marks & Spencer fell 3.5 to 3.6 percent.
Some positive moves punctured the gloom, however.
Outsourcing group Serco jumped 9.6 percent after the firm said it expected revenue to start to grow for the first time in six years in 2019, while G4S rallied 7.1 percent after the British security company said it was separating its cash and notes business.
(Reporting by Josephine Mason; editing Larry King and John Stonestreet)