Investors deserted the London market today as fears of a eurozone collapse were fuelled by a worrying rise in Spain’s borrowing costs.
The FTSE 100 Index fell 1.5% or 85.9 points to 5,423.1 after Spain was forced to pay nearly 7% to borrow £3billion.
Banks and miners led the market lower as investors shunned risk. Taxpayer backed Lloyds Banking Group was down 5%, or 1.2p at 25.7p, while miner Vedanta Resources was off 75p at £10.14.
Dire updates from Mothercare and French Connection sparked sell-offs for retail stocks.
Mothercare shares fell 18%, or 27.7p to 127.3p, while French Connection stocks fell 16% or 11.4p to 62p.
Other retail shares on the back foot included Next, which fell 34p to £27.76 and Marks & Spencer, which was 5.6p lower at 319.4p
Scottish Gas owner Centrica recovered most of its earlier falls after a profits warning – the energy supplier fell 0.2p to 294.6p.
Meanwhile, Pace shares were 24% lower or 14.8p to 45.6p after it said the floods which have shut down a key supplier in Thailand would continue to impact its profits in 2012.
The biggest Footsie risers were Admiral up 24.5p at 825p, National Grid ahead 15p at 641.5p, Rexam up 7.7p at 332.8p, and Glencore ahead 7.8p at 412.9p.
The biggest Footsie fallers included Essar Energy off 16.4p at 242.5p, Antofagasta down 71p at £11.03, and Fresnillo down 110p at £17.59.
Alan MacPhee, of investment manager and financial planning specialist Brewin Dolphin in Aberdeen, noted that Encore Oil rallied 1.65% to 76.875p with Premier Oil adding 1.17% to 371.3p. Transport business Stagecoach added 0.83% to finish at 256.35p.
Fallers included STV Group which slipped 9.4% to 94p with Johnston Press closing down 7.77% to 5.15p.