Global recession fears sparked by woeful economic data from Japan, China and the United States saw world markets retreat today
The FTSE 100 Index closed 33.8 points lower at 5854.6 after Chinese manufacturing and Japanese trade figures were followed by a smaller-than-expected drop in jobless benefit claims in the US.
Miners were the worst hit in London after the Japanese data revealed the country's export sector continued to suffer the effects of a slowdown in the eurozone, while there was also another month of contraction among Chinese manufacturers.
The pound was down against the US dollar at 1.61 as fears for the global economy boosted the greenback, which is seen as a safe-haven investment. Sterling was up against the euro at 1.25.
Figures from the CBI showing signs of an improvement for Britain's manufacturing sector this month offered little respite for the FTSE 100, which had opened on the back foot after key Asian markets dropped by around 1% overnight.
And a better-than-expected reading on the Philadelphia Fed Business Index in America - which rose to minus 1.9 in September from minus 7.1 the previous month - did little to cheer the markets on either side of the Atlantic.
Concerns over the impact of a global slowdown on demand left miners nursing heavy losses, with Evraz dropping by 6%, off 16.7p to 260.8p, Anglo American declining by 90p to 1944p and Vedanta Resources down 26p to 1054p.
On a shortened list of FTSE 100 risers, BSkyB made gains after it was told by regulator Ofcom that it remained "fit and proper" to hold a broadcasting licence, despite the phone hacking scandal at a newspaper owned by major shareholder News Corporation. Shares were 7p higher at 734p, a rise of 1%.
Lambert & Butler maker Imperial Tobacco topped the FTSE 100, up 3% or 63p to 2399p, as it shrugged off a disappointing update that revealed the group was suffering from trade sanctions against conflict-torn Syria and sales weakness in Ukraine and Poland.
Bristol-based Imperial expects sales volumes to fall by up to 3% in the year to September 30, but analysts said stronger performances in higher-margin regions should offset the sales pressure.
Online grocer Ocado was 4% lower in the FTSE 250 after a disappointing third quarter update that revealed sales growth slowed to 9.9% from 12% in the first half.
Ocado blamed disruption from the Queen's Diamond Jubilee celebrations and the Olympics and said customer ordering had now "returned to normal", with hopes for growth to pick up again in the fourth quarter. Shares fell 2.8p to 64.4p.
Figures from suit specialist Moss Bros showed flat half-year profits of £2.2 million, although the company said this reflected rising raw material costs and the deferral of weddings into the second half of the year due to Britain's busy summer of events. Shares were a penny higher at 46p.
The biggest Footsie risers were Imperial Tobacco up 63p at 2399p, International Consolidated Airlines Group ahead 3.6p at 158.8p, ITV up 1.7p at 91.2p and Ashmore ahead 4.5p at 343p.
The biggest Footsie fallers were Evraz down 16.7p at 260.8p, Anglo American off 90p at 1944p, Capital Shopping Centres down 14.2p at 332.4p and Eurasian Natural Resources off 13.8p at 343.6p.
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