Source: Sharecast
The 100 was down 0.6% to 7,273.24, while the pound was off 0.6% against the dollar at 1.3041 and 0.2% lower versus the euro at 1.1365. The pound was hit by surveys from Deloitte and the British Chamber of Commerce, both of which showed that UK business are becoming increasingly nervous about Brexit.
The BCC's quarterly survey of 5,600 companies found that the percentage of services firms trying to recruit is at its lowest level for 25 years and of those services firms recruiting, difficulties rose to a record high.
Stocks kicked off the session on the back foot following heavy losses in Asia, after the People's Bank of China reduced the amount of capital banks need to hold in relation to their loan book. Analysts said this suggested concerns about the economy or a way for China to gear up for a protracted trade conflict.
Rabobank said: "The PBOC’s most recent move suggests that Chinese officials were either attempting to shore up economic growth by providing a confidence boosting signal that the central bank stands ready to provide credit as and when needed or suggests that efforts to stave off the impact of the trade war thus far have simply not been enough. The latter seems more plausible given the market’s disappointing reaction to the announcement and the notable intensification in verbal blows from Washington combined with a reluctance from either side of the negotiation table to give ground.
"That the trade war is intensifying and the government and central bank are in the position where easier credit conditions are clearly required all but suggests that it is China’s economy, and not that of the US, which is very much in the firing line."
As well as trade war worries, investors were digesting the latest goings on in Europe after the EU reiterated its concerns over Italy's budget plans over the weekend. The European Commission said Italy's proposal to set out a deficit target of 2.4% of GDP for next year was a "source of serious concern". The news sent Italian government bond yields surging, while the FTSE Mib index dropped 2.2%.
US bond markets will be closed on Monday for Columbus Day, but equity markets will be open as usual.
In UK corporate news, Lancashire Holdings tumbled after saying it expects to report third-quarter net losses following hits to its marine portfolio and exposure to natural disasters including US hurricane Florence, and Asian typhoons Jebi, Mangkhut and Trami.
RPC Group suffered heavy losses as investors fretted about potential suitors Apollo Global Management and Bain Capital's 1700 BST deadline to either announce a firm intention to make an offer for the group or walk away.
Schroders edged up as it responded to press reports by confirming it is in discussions with Lloyds Banking Group about working together "in parts of the wealth sector". Last week the fund manager was said to be poised to win the £109bn mandate to manage Lloyds' Scottish Widows investment assets.
Elsewhere, Dechra Pharmaceuticals ticked higher as it announced the acquisition of New Zealand vet supplier Caledonian for NZ$8.7m (£4.4m).
Hammerson advanced after agreeing to sell its 50% stake in the Highcross shopping centre in Leicester for £236m, while Acacia Mining rallied as lifted its full-year gold production target following better-than-expected third-quarter output.
On the broker note front, IAG was a big faller after being cut to 'neutral' at Citi, while Vodafone was cut to 'hold' at Jefferies, and Tesco was downgraded to 'add' by AlphaValue. Hastings was downgraded to 'reduce' at Investec, Halma was cut to 'hold' from 'buy' at Shore Capital and Quiz was downgraded to 'hold' at Peel Hunt.
Intu Properties was lifted to 'buy' by Citi, Mediclinic was upgraded to 'buy' by Investec, and Inmarsat was initiated at 'buy' by Bank of America Merrill Lynch.
Market Movers
FTSE 100 (UKX) 7,273.24 -0.62%
FTSE 250 (MCX) 19,789.83 -0.64%
techMARK (TASX) 3,406.72 -0.80%
FTSE 100 - Risers
Next (NXT) 5,464.00p 2.32%
SEGRO (SGRO) 619.60p 1.67%
BT Group (BT.A) 233.20p 1.35%
Centrica (CNA) 152.50p 1.33%
United Utilities Group (UU.) 706.00p 1.00%
Smurfit Kappa Group (SKG) 2,844.00p 0.99%
Marks & Spencer Group (MKS) 286.50p 0.99%
Land Securities Group (LAND) 855.80p 0.85%
SSE (SSE) 1,128.00p 0.80%
Whitbread (WTB) 4,597.00p 0.77%
FTSE 100 - Fallers
Halma (HLMA) 1,386.00p -3.48%
Melrose Industries (MRO) 185.80p -3.10%
Ashtead Group (AHT) 2,244.00p -2.52%
Vodafone Group (VOD) 156.36p -2.41%
Rolls-Royce Holdings (RR.) 938.60p -2.25%
Ocado Group (OCDO) 786.20p -2.14%
Burberry Group (BRBY) 1,865.50p -2.02%
BP (BP.) 576.70p -2.01%
Standard Life Aberdeen (SLA) 291.20p -1.82%
Barclays (BARC) 169.84p -1.79%
FTSE 250 - Risers
Vivo Energy (VVO) 129.66p 9.70%
Millennium & Copthorne Hotels (MLC) 523.00p 2.55%
Card Factory (CARD) 191.00p 2.47%
Stobart Group Ltd. (STOB) 242.00p 2.33%
Greene King (GNK) 493.90p 2.28%
Mediclinic International (MDC) 453.60p 2.23%
Shaftesbury (SHB) 906.50p 2.08%
Kier Group (KIE) 909.50p 1.85%
Clarkson (CKN) 2,805.00p 1.81%
St. Modwen Properties (SMP) 385.20p 1.69%
FTSE 250 - Fallers
RPC Group (RPC) 751.50p -7.63%
Lancashire Holdings Limited (LRE) 554.50p -5.54%
Cranswick (CWK) 3,190.67p -5.43%
Hastings Group Holdings (HSTG) 237.00p -4.44%
Sophos Group (SOPH) 437.00p -3.70%
Aveva Group (AVV) 2,604.00p -3.41%
Weir Group (WEIR) 1,701.00p -3.38%
IP Group (IPO) 121.80p -3.33%
Beazley (BEZ) 560.50p -3.20%
Computacenter (CCC) 1,269.68p -2.93%