Storm-hit Wall Street was also under pressure amid market volatility as it reopened following its two day closure.
America's Dow Jones Industrial Average swung into the red soon after opening, while London's FTSE 100 closed 67.2 points lower at 5782.7.
Trading volumes surged after the New York Stock Exchange and Nasdaq reopened following the Hurricane Sandy lockdown, which saw the NYSE close for two sessions in a row for the first time since 1888.
In currency news, the pound gained ground as recent robust UK economic data cut chances of the Bank of England pumping in more money under its Quantitative Easing scheme.
Sterling rose to 1.61 US dollars and 1.24 euros.
Barclays was one of the biggest share losers - down 5% or 11.3p at 227.5p - after it admitted separate US authorities were looking into transactions between the bank and Middle East investors as well as power trading in America's west.
It also revealed a £47 million loss in the third quarter, compared to a £2.2 billion profit last year, after a £700 million hit to cover mis-sold payment protection insurance claims and a one-off £1 billion charge against the value of the bank's own credit.
However, shares have risen 19% over the last year and analysts said the decline in the share price was partly driven by profit taking.
Hefty falls from oil and gas exploration giant BG also weighed on the Footsie, with the group plunging 14% after scaling back production forecasts for next year.
The downgrade comes after the prolonged shutdown of the Elgin platform in the North Sea following a gas leak in March and its decision to reduce drilling in the US due to low natural gas prices.
Shares slumped 182p to 1147.5p following the third quarter update, which showed a 16% rise in underlying earnings to 1.19 billion US dollars (£741 million).
Retail giant Next was also down, by 39p to 3566p, despite increasing the lower end of its forecast profits range for the current financial year by £15 million to £590 million.
But investors were spooked by slower growth for its directory business and the company's comments about its overall sales performance remaining volatile.
A disappointing third quarter update from GlaxoSmithKline added the group to the fallers' board, down 33.5p to 1386.5p, as it said sales fell 5% and were expected to remain flat over the full-year against a previous expectation for growth of 2%.
Outside the top flight, Britvic was in focus after it revealed an extended deadline to complete discussions with Irn Bru parent AG Barr over a merger. Britvic was 0.8p down at 359.2p, while AG Barr dropped 3p to 445p.
The biggest Footsie risers were Petrofac up 56p to 1604p, Standard Life ahead 6.4p to 292p, Resolution 4.6p higher at 218.3p and Randgold Resources up 150p at 7400p.
The biggest Footsie fallers were BG Group down 182p to 1147.5p, Barclays off 11.3p to 227.5p, Croda International 64p lower at 2201p and Kazakhmys down 20.5p to 709p.
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