MORE than £34 billion has been wiped off the FTSE 100 after stocks suffered a double whammy of trade war fears and worries that next week's Opec meeting could lead to another global oil glut.
The blue chip index slid 1.7% or 131.88 points to 7,633.91 points.
It followed global stocks lower but took a bigger hit than its European peers, with the French Cac 40 and German Dax ending the day down nearly 0.5% and 0.7%, respectively.
The FTSE 100 last suffered a bigger one-day decline in early February, when the index closed lower by 2.6%.
Equities are facing renewed pressure after the US administration led by President Donald Trump announced tariffs on $50 billion worth of Chinese imports, with China now planning to impose similar penalties on American goods.
Oil glut fears prompted an even further drop in London stocks.
Connor Campbell, a financial analyst at SpreadEx, said: "Far and away the worst performing major index on Friday was the FTSE.
"That's because it wasn't only dealing with the renewed trade war tensions, but an oil sector fearful of what Opec will announce next week."
Traders are now preparing for a potential boost to output in the wake of the oil cartel's meeting in Vienna, which would increase global supply and drive down oil prices.
Brent crude prices slumped 3.4% to $73.30 per barrel, sending BP shares down 20.5p to 565p and Royal Dutch Shell's 'B' shares down 85p to 2,625.5p.
In currency markets the pound was mixed, falling 0.2% versus the euro to 1.143 but rising 0.2% against the US dollar to 1.328.
In UK stocks, Tesco jumped 5p to 254.8p after delivering its 10th consecutive quarter of sales growth, boosted by its recent acquisition of wholesale firm Booker.
The group's like-for-like sales were up 1.8% for the 13 weeks to May 26, with comparable sales rising by 3.5% in the UK and Ireland.
Rolls-Royce surged 67.2p to 950p, having assured investors that it had taken measures to offset £100 million in additional costs linked to the discovery of technical issues with its engines.
The company is grappling with problems with its Package B Trent 1000 engines, as well as a durability issue with its Package C Trent 1000 engines.
On Friday, Rolls said it could see costs associated with the issues rise from £340m to £440 million.
SThree rose 7p to 337p after the specialist recruitment business - which focuses on science and technology staff - reported an 11% jump in half-year gross profit growth to £148.4m, despite a softening in its UK division.
Purplebricks fell 3.8p to 352.6p after reporting that it was expanding its US footprint with plans to launch in Las Vegas and Phoenix next week.
It comes nine months after the company first dipped its toe into the American real estate market, starting in Los Angeles last September, which was followed by a rollout to San Diego, Sacramento, Fresno and New York.
The biggest risers on the FTSE 100 were Rolls-Royce Holdings up 67.2p at 950p, Tesco up 5p at 254.8p, Relx up 16p at 1,625.5p, and Smurfit Kappa Group up 30p at 3,082p.
The biggest fallers on the FTSE 100 were Old Mutual down 11.4p to 215.5p, DCC down 345p at 6,905p, BHP Billiton down 78.8p at 1,670p, and Glencore down 17.2p at 381.3p.
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