Investors endured a fourth successive session of declines as a fresh slump for global markets left the FTSE 100 Index nearly 3% lower since Monday morning.
The downward spiral since Wall Street's Dow Jones Industrial Average topped 17,000 for the first time a week ago has been sparked by fears over the forthcoming crop of half-year results in the United States.
It has seen the FTSE 100 go from near to a record high to its lowest point since April, with the top flight 45.7 points lower at 6672.4 in the latest session, a drop of 0.7%. New York's Dow Jones was down by a similar level.
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This was better than in Paris and Frankfurt where markets fell faster after figures showed French manufacturing output slumped by 2.3 per cent in May.
There was a brief respite at the start of the session after minutes from the Federal Reserve's recent meeting showed that members of the US central bank are in no hurry to increase interest rates.
The Bank of England's decision to keep its base rate at 0.5 per cent, despite the gathering arguments for a rise, also helped soothe investor nerves.
Sterling, which has been buoyed by expectations of a rate hike, slipped against the greenback, but remained above the 1.71 US dollar mark and climbed against the single currency to near 1.26 euros.
Heavyweight fallers in London included Barclays - down 3.5p to 208p - and Royal Bank of Scotland, down 1.3p to 314.9p.
Airline stocks continued to experience turbulence as British Airways owner International Airlines Group dropped more than two per cent or 8.3p to 331.7p and easyJet fell 15p to 1272p.
Burberry was the top stock on a shortened FTSE 100 risers board after it said retail revenues for the first quarter to the end of June were up 17% to £370 million, including 12% from existing stores.
Despite it warning that the strength of the pound could have a deepening impact on its bottom line, shares rose three per cent or 45p to 1464p.
The shortened list of risers also featured Tesco after it raided Marks & Spencer to hire Alan Stewart as its new finance director. Shares lifted 1.2p to 280.7p.
There was no boost for investors in Associated British Foods, although the Primark owner raised its earnings guidance on the back of strong retail, grocery and ingredients performances.
It is also suffering from the impact of the strong pound and while Primark sales were up by 22 per cent on a constant currency basis in the quarter to June 21, shares fell by more than one per cent, off 42p to 2958p.
The biggest risers on the FTSE 100 Index were Burberry up 45p to 1464p, Randgold Resources up 140p to 5235p, Sainsbury's up 5.7p to 314.9p and Shire up 81p to 4600p.
The biggest fallers were Hargreaves Lansdown off 52p at 1128p, Ashtead down 35.5p to 878.5p, London Stock Exchange Group down 60p to 1896p and Travis Perkins down 42p to 1574.