Britain's top share index was down 0.9 percent in mid-session trade on Thursday, with banks weighed down by comments from the U.S. Federal Reserve, and retailers weaker after a surprise fall in UK November sales.
At 1157 GMT, the FTSE 100 was down 45.07 points at 5,275.19, having closed 34.49 points, or 0.7 percent, higher on Wednesday at 5,320.26.
The index is up 52 percent from a six-year low in March, though it is still 2.6 percent below its level in mid-September 2008 before the collapse of Lehman Brothers.
"The (retail sales) data out in the U.K. this morning compounded sentiment following the Fed announcement last night, handing investors the excuse to lock-in gains after yesterday's rally," said Jimmy Yates, head of equities at CMC Markets.
Banks were lower after the U.S. central bank's policy-making committee reminded markets it will let most of the special liquidity facilities, which have helped bolster the U.S. banking system since last year's credit crisis, expire by early next year.
HSBC, Barclays, Lloyds Banking Group, Royal Bank of Scotland and Standard Chartered were off 1.6 to 4.4 percent, shedding the previous session's gains.
Retailers were hit after British retail sales fell unexpectedly in November.
Home improvements retailer Kingfisher, electricals retailers DSG International and Kesa Electricals, and clothing-to-foods group Marks & Spencer fell 0.5 to 3.0 percent.
Home Retail was down 2.0 percent and was also impacted by a downbeat note from Credit Suisse saying that structural concerns and price falls at its Argos chain could place pressure on gross profit margins.
Figures from the Office for National Statistics showed sales dropped at their fastest pace since May after department stores and clothing retailers failed to repeat October's strong sales.
A report from the Confederation of British Industry added to the gloom. It said British retail sales volumes maintained a steady pace of growth in December, but firms are less optimistic about the New Year when value added sales tax rises.
COMMODITIES PRESSURED
Weak energy and mining issues also weighed on the FTSE 100 as the dollar surged to three-month highs after the Federal Reserve comments on the U.S. economy.
Miners were in reverse, having notched up good gains on Wednesday as metals prices dropped, with gold falling 1 percent in European trade.
Antofagasta, Xstrata, Lonmin Eurasian Natural Resources and Kazakhmys were down 2.4 to 3.3 percent.
Rio Tinto was down 2.1 percent and BHP Billiton fell 0.6 percent. China's steel industry association said that every country should unite in opposition to a "monopolistic" production joint venture between the two Australian mining giants.
Energy stocks fell as crude dipped 0.7 percent, with BG Group, BP, and Royal Dutch Shell down 0.2 to 1.5 percent.
Pharmaceutical stocks were also lower, with Shire a top blue-chip faller, off 1.7 percent, as UBS cut its rating on the stock to "neutral" from "buy", mainly on valuation grounds.
GlaxoSmithKline fell 0.6 percent.
On the upside, Rentokil Initial was the top riser ahead of its relegation from the FTSE 100 next week, up 3.6 percent, building on gains made Wednesday when Deutsche Bank hiked its target price and estimates for the support services group.
Britons' inflation expectations for the coming year held steady at 2.4 percent in November, the same as August and May, a quarterly survey from the Bank of England showed.
