UK stocks experienced a downturn on Friday, mainly due to a significant drop in Legal and General Group shares, which dragged down the life insurance sector.
The FTSE 100, representing blue-chip stocks, fell by 0.3% and hovered near a two-week low, while the midcap FTSE 250 slipped by 0.2%, marking losses for the second consecutive week. Legal & General saw a notable decline of 3.1%, hitting its lowest point in two months, following a Citigroup price target reduction.
The broader life insurance index also took a hit, dropping 2.2% to reach a three-week low. Citigroup’s analysis pointed out that while Legal & General maintains robust solvency, the recent change in CEO suggests limited potential for additional capital returns at present.
Despite this, shares in the automobiles and parts sector saw a 1.2% increase, although they were down for the week.
Bank of England policymaker Jonathan Haskel’s remarks influenced the bond market, leading to a rise in British 10-year benchmark note yields to their highest level in over two months.
Haskel expressed optimism about signs indicating a possible easing of inflation pressures in Britain but emphasized the need for more evidence before reconsidering his stance. Traders now anticipate approximately 70 basis points of rate cuts in 2024.
![UK stocks continue to go lower for the third week (Credits: Yahoo Finance)](https://otakucart.com/wp-content/uploads/2024/02/UK-stocks-continue-to-go-lower-for-the-third-week.jpg)
In other market movements, Barclays shares declined by 0.6% following Tesco’s announcement of selling most of its banking operations to Barclays for up to £600 million ($757 million).
Additionally, S&U, a motor finance firm, experienced the most significant decline on the FTSE smallcap index, falling by 7.9% after its annual profit forecast fell below market expectations. However, specialty chemicals maker Victrex saw a modest 0.8% increase following a decrease in first-quarter revenue.