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.

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.