After rising as much as 0.7%, the blue chip FTSE 100 index fell 0.1%, with defensive sectors, such consumer staples, healthcare and utilities at the forefront of losses.

But Standard Chartered was the worst performer on the FTSE 100, tumbling 6.2% after the impact of the COVID-19 pandemic more than halved its annual profit.

Mining stocks, including Rio Tinto, Anglo American, and BHP, were the biggest boosts to the FTSE 100, with oil heavyweights BP and Royal Dutch Shell also providing support on strong crude and metal prices. [MET/L] [O/R]

The domestically focused mid-cap FTSE 250 index fell 0.5%.

"I think investors are a little uneasy with what we're seeing in the bond markets in terms of rising yields and the pace at which they're rising," said Craig Erlam, senior market analyst at Oanda.

"We're still lacking a lot of direction until we start to see signs of stabilisation or even a reversal in those yields."

Stimulus measures have helped the FTSE 100 recover 35% from its March lows. But a corresponding rise in bond yields on higher inflation expectations has weighed on stocks this year.

Yields on 10-year British bonds were at 11-month highs, Refinitiv data showed.

Meanwhile, data showed that the cost of Britain's furlough scheme reached 53.8 billion pounds ($76.2 billion) last month as the country went back into a coronavirus lockdown.

In company news, Hikma Pharmaceuticals shed 3.2% even after issuing an upbeat outlook.

Aston Martin gained 6.8% after the luxury carmaker said it expects to almost double sales and move back towards profitability this year.

Anglo American gained 3.9% as it boosted dividends after strong commodity prices helped the miner recover from coronavirus disruptions suffered in the first half of 2020.

(Reporting by Shivani Kumaresan and Amal S in Bengaluru; editing by Uttaresh.V and Barbara Lewis)

By Shivani Kumaresan and Amal S