LONDON: Britain’s main stock index fell on Wednesday as a stronger pound weighed on exporters, while Lloyds Banking Group rose 2.2% after the bank resumed a dividend despite a sharp drop in annual profit. The blue-chip FTSE 100 index was down 0.3% by 0930 GMT as sterling rose to a three-year high against the dollar.

Financial stocks including HSBC Holdings and Standard Chartered were among the biggest drags on the FTSE 100, tracking a 2.9% slump in Hong Kong’s Hang Seng index on concerns over policy tightening. Losses in consumer stocks Unilever PLC and British American Tobacco also weighed on the index.

“The market just seems to have lost a bit of energy and the fact that we are seeing high yields has made investors a little nervous,” said Craig Erlam, senior market analyst at OANDA. The FTSE 100 has recovered about 35% from a coronavirus-driven crash last year, but it has come under pressure more recently as fears of rising inflation have hit equities worldwide.

The mid-cap FTSE 250 index gained 0.5%, led by consumer discretionary and industrials stocks. In company news, Metro Bank fell 6.9% as it posted a much bigger annual loss and said it expects defaults to rise through the year as government support measures set in place due to the COVID-19 crisis are wound down.

Drugmaker AstraZeneca Plc shed 1.4%, as it told the European Union it expects to deliver less than half the COVID-19 vaccines it was contracted to supply in the second quarter. Consumer goods maker Reckitt Benckiser slipped 0.1% even as it capped 2020 with the strongest sales in its history, while Aviva slid 0.4% as it agreed to sell its 40% stake in a joint venture in Turkey for 122 million pounds ($173.17 million).