The FTSE 100 Index closed 15.6 points lower at 5776.1 amid fears the US election will be followed by a drawn-out battle over the looming fiscal cliff, which will mean automatic tax increases and spending cuts from January 1.
The top flight had spent much of the session ahead as upbeat economic data and progress in Greece helped overshadow concerns over the forthcoming US budget debate.
A decline in US unemployment claims and the trade deficit did not cheer investors for long as Wall Street's Dow Jones Industrial Average also drifted into the red at the time of the London close.
Meanwhile, traders were little moved by the Bank of England's decision to leave its quantitative easing stock unchanged at £375 billion.
The mood was dampened further when Mario Draghi, head of the European Central Bank, which also left its key interest rate unchanged at 0.75%, said the outlook for the economy remains "weak".
The pound was higher against the euro at 1.25 following the no-change decision in Frankfurt, while sterling fell against the US dollar to 1.59.
Outsourcing firm G4S was one of the biggest fallers on the FTSE 100 Index, falling more than 3%, after it lost the contract to run the Wolds prison in East Yorkshire.
It is the latest blow for the firm after it took an estimated £50 million hit from its failure to provide enough guards for this summer's Olympic Games. Shares were 8.4p lower at 259.2p.
Another Olympics contractor under pressure was Balfour Beatty after the construction group warned annual profits will be lower than expected at the time of the half-year results.
It blamed a lack of major contracts as its regional business now accounts for half its order book, compared to a third last year. Shares were down 55.9p to 250.1p, a fall of 18%.
Back in the top flight, Tesco was broadly flat at 322.2p, in a session when rival Morrisons announced a 2.1% drop in quarterly underlying sales.
The Bradford-based chain has been left trailing as competitors wage war through promotional deals, leaving its shares 4p lower at 263.5p.
Aviva rose 1.8p to 330.3p after it said it was in talks over the sale of the company's US life and annuities businesses, part of chairman John McFarlane's programme of "significant change" at the insurer.
Elsewhere, pubs chain JD Wetherspoon was 2% or 9p higher at 521.5p as analysts at N+1 Singer moved their rating on the pubs chain to buy following a 7.1% rise in like-for-like sales for the 13 weeks to October 28.
The share price rally came despite the company warning of additional cost pressures.
The biggest Footsie risers were Randgold Resources up 120p at 7070p, Croda International ahead 29p at 2210p, British American Tobacco up 39.5p at 3174p and Burberry ahead 15p at 1214p.
The biggest Footsie fallers were Eurasian Natural Resources down 10.4p at 294.6p, G4S off 8.4p at 259.2p, CRH down 27p at 1130p and Kazakhmys off 16p at 686.5p.