Signs of a longer lockdown in Britain knocked 4% off UK's midcap shares on Wednesday, while plunging oil prices hit the commodity-heavy FTSE 100 index. The FTSE Mid 250 index, comprising companies more exposed to the British economy, posted sharper losses for a second straight session, compared with the internationally-focussed FTSE 100, which was also down 2%.

Shares in Royal Dutch Shell and BP fell about 5% each as oil prices dived on reports that highlighted persistent oversupply and collapsing demand concerns due to global coronavirus-related lockdowns.

"A lot of the domestic weakness is around concerns over the UK economy being locked down for longer," said Roger Jones, head of equities at London & Capital. "The UK previously looked like one of the first countries to come out of the lockdown situation in Europe, and they now look to be potentially one of the last countries."

Shares in insurer Hiscox slumped 16.3% to the bottom of the midcap index after brokerage Peel Hunt reduced price target to 800 pence from 1,030 pence. Pub operators Mitchells & Butlers and J D Weatherspoon, who have forecast a severe hit to earnings as pubs and restaurants in the UK remain shut, slid more than 10%.

Asset managers declined after Jupiter Fund Management reported a drop of 18.3% in assets under management in the first quarter as fears over the pandemic rattled financial markets. Smaller rival Merian Global Investors was the worse hit.

Jupiter's shares tumbled 7%, while Ashmore Group, Schroders and Standard Life Aberdeen dropped between 3.6% and 5.5%. Shares in Kromek, a global supplier of medical devices, jumped 10.2% after announcing plans to start manufacturing of medical ventilators in Britain and globally under a licence from Japan's Metran.