Beleaguered security firm G4S suffered another 6% drop in its share price on the day that its boss admitted its reputation lay in tatters.
G4S's shares gave up 14.6p to 240p as chief executive Nick Buckles told MPs the London Olympics staffing episode had been a "humiliating shambles", meaning the group has seen more than £700 million wiped off its value since last Wednesday.
The problems at G4S and further revelations in relation to the Libor-fixing scandal contributed to another lacklustre session for the London market, with the FTSE-100 index closing 33.34 points lower at 5629.09.
The Dow Jones industrial average was flat as the London market closed, amid disappointment US Federal Reserve chairman Ben Bernanke failed to give any indication that more stimulus measures were imminent.
Germany's Dax was slightly higher but France's CAC40 lost earlier gains even though a successful Spanish bond auction helped ease fears about the country's future.
The pound was down at 1.56 against the dollar after June's inflation figures came in at a lower than expected 2.4%, boosting the chances of more quantitative easing.
However, there was good news for holidaymakers heading to the Continent after sterling rose to 1.28 against the euro, as the single currency continued its recent slide.
Back in London, the Libor-rigging scandal continued to dog Barclays as Bank of England Governor Sir Mervyn King said the bank and its directors had failed to take on board the seriousness of regulatory concerns about how the bank was run.
Despite this, Barclays was among the biggest risers on the Frootsie index, with the shares recovering some of their recent weakness to climb 1.3p to 159p.
Other banking stocks fell despite stronger than expected earnings from US giant Goldman Sachs.
HSBC was down 9.4p at 547.4p, or 2%, after the head of com-pliance at the British banking giant resigned as it emerged the bank had exposed the US to billions of dollars worth of money laundering, drug trafficking, and terrorist financing.
Building supplies firm Wolseley was one of the biggest fallers in the top flight after it said it was exploring strategic options for the future of its business in France.
The shares fell 45p to 2283p, a drop of 2%.
In the FTSE-250 index, chip designer CSR surged 34% after it sold its mobile phone arm to electronics giant Samsung in a deal worth £198m. The shares rose 73.7p to 292p.
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