Mining shares led a market slump fuelled by the US Federal Reserve signalling a possible end to quantitative easing and poor economic data from China.
Investors around the world took fright as Fed chairman Ben Bernanke unveiled plans to start scaling back its $85bn a month bond buying programme later this year, depending on economic data, while China's manufacturing sector weakened to a nine-month low in June, according to a preliminary HSBC PMI report.
On top of that, China's central bank resisted further stimulus measures, and overnight interest rates have moved sharply higher.
A set of positive US economic figures - the Philadelphia Federal Reserve's monthly survey of business confidence turned positive while new housing starts were better than expected - had a negative effect. Analysts said the upbeat data, which could have boosted markets at another time, reinforced concerns that Bernanke would soon act to turn off the money taps.
So the FTSE 100 fell 189.31 points to 6159.51, a 2.98% decline which marked the biggest one day fall since 22 September.
Copper slid to a 20 month low on the Chinese and Fed news, while silver and gold also plunged. So miners made up six of the top ten FTSE 100 fallers, with Polymetal losing 73.5p to 541p and Mexican silver miner Fresnillo falling 84.5p to 960.5p. Randgold Resources dropped 348p to £42.96 while Antofagasta lost 45p to 824.5p.
FTSE 250 miners were also under pressure, with New World Resources down 14.4p to 65.6p and Petropavlovsk 13.9p lower at 130.1p.
