Blue chips stock fell in afternoon trading in a busy session as traders weighed up a High Court ruling that said Parliament must vote on whether the UK can start the process of leaving the EU.
This means the government cannot trigger Article 50 of the Lisbon Treaty – beginning formal exit negotiations with the EU – on its own. This complicates an already complex Brexit process.
The FTSE 100 Index fell 29 points to 6816.4, after the Bank of England now says its next interest rate change, whenever it comes, could move in either direction. It had previously signalled that the rate was likely to be cut to move from the historic low of 0.25% to 0.10%. Cheap cash favours investors.
The FTSE 250 Index lifted 160.3 points to 17623.8.
The UK's powerhouse services sector grew to 54.5 in October, from 52.6, signalling the fastest expansion since January, according to the Markit /CIPS UK Services PMI index. A mark above 50.0 denotes expansion.
However, the report also noted that the weak pound led to the highest month-on-month rise of inflationary cost pressures in the sector since the survey began 20 years ago. It added that input price inflation surged to the highest since March 2011.
IG market analyst Joshua Mahony said: "The FTSE has extended the week's losses on one of those days that will remain within the memory for years to come.
"Many of the key tenets that underpinned our understanding of a post referendum world have come crumbling down, with a reversal in monetary policy expectations accompanied by questions over whether Article 50 will ever even be implemented."
In afternoon trading the biggest risers in the FTSE 100 Index were Royal Bank of Scotland (+12.3p to 195p), Dixons Carphone (+15.1p to 341.5p), British Land (+25.5p to 610.5p), Marks & Spencer (+12.6p to 353p) and Whitbread (+120p to 3702p).
The biggest fallers in the FTSE 100 Index were Randgold Resources (-435p to 7150p), Fresnillo (-69p to 1711p), Johnson Matthey (-101p to 3268p), GlaxoSmithKline (-48p to 1558.5p) and Pearson (-19.5p to 732p).
In afternoon trading the biggest risers in the FTSE 250 Index were Shawbrook Group (+22p to 233.2p), Inmarsat (+73p to 803p), Lancashire Holdings (+57p to 766p), Indivior (+19p to 369.4p) and CMC Markets (+9.5p to 202.5p).
The biggest fallers in the FTSE 250 Index were esure Group (-68p to 197.8p), Playtech (-52p to 869p), Evraz (-11.5p to 192.5p), Howden Joinery Group (-19.6p to 362.3p) and Acacia Mining (-19.5p to 530p).