FTSE 100: 7364.56 ▼ -60.84 (-0.82%)
Update: Defensive stocks have led a FTSE 100 fightback, helping the index erase the day's losses despite US markets lurching lower at the open.
The FTSE 100 regained poise to trade at 7,024, just four points lower on the day and up from a low of 6,973 earlier in the session.
That bucked a fall in US markets following the latest sparring from the US and China over tariffs.
The US yesterday revealed plans for a 25% tariff on 1,333 Chinese products, met swiftly with retaliation from China, which announced 25% tariffs on 106 US products.
The US list of Chinese products, released yesterday, covers imports worth around $50 billion (£35 billion) according to the Financial Times, and features products ranging from industrial robots to locomotives.
The White House has claimed the tariffs are needed to tackle what it says is the theft of intellectual property from US businesses.
US president Donald Trump said yesterday the tariffs would help to tackle the US trade deficit with China.
'Our relationship is very good with China, and we intend to keep it that way,' he said. 'But we have to do something to seriously relive that trade deficit.
China's tariff plans meanwhile cover US products like soybeans, cars and chemicals.
It said the US tariffs violated World Trade Organisation rules, and that it was ready to counter protectionist measures.
'It would appear that gloves are off in relation to the trade war between the two largest economies in the world,' said David Madden, market analyst at CMC Markets UK.
'Dealers will be half expecting a retaliation from president Trump, and the exodus from equities is likely to continue.'
WPP (WPP) was also among the fallers, down 2% at £10.94 after the advertising agency announced an independent investigation into an allegation of personal misconduct against chief executive Martin Sorrell.
'While the company says the allegations "do not involve amounts which are material to WPP" it is hard to know what the company would look like under different leadership,' said Russ Mould, investment director at AJ Bell.
'Sorrell has been at the helm of the business since it was a wire shopping basket manufacturer called Wire and Plastic Products.'
Among small-cap stocks, Topps Tiles (TPT) fuelled fears over the state of UK retail as the flooring chain announced a 2.2% drop in second quarter sales, sending its shares 11.6% lower to 71.1p.