The leading share index sank this morning as Italy voted for a hung parliament, which spooked stock markets.
Italy faced political deadlock after a protest vote left no party or no likely coalition with enough seats to form a majority.
In early trading, the FTSE 100 was down almost 1.3 per cent, with financial shares mainly feeling the heat.
Barclays was the biggest faller in early deals, falling 4.3 per cent. RBS followed suit, shedding 2.9 per cent. HSBC fell 2.14 per cent, and Lloyds Banking Group was down 2.77 per cent.
Asset manager Schroders was also in the top five fallers, sinking 2.9 per cent, alongside steelmaker Evraz, which fell 2.8 per cent.
Restaurant and hotel chain Whitbread, which this morning posted a fourth quarter trading update, was down 3.4 per cent. The group said it would meet its annual profit forecasts, even though bad weather slowed sales in the last three months of 2012.
Outside of the blue chips, regeneration specialist St Modwen fell 7.5 per cent as it proposed a placing of 20m new shares to fund development of New Covent Garden Market in Vauxhall.
At the other end of the spectrum, speciality chemical maker Croda posted a 6.6 per cent rise in full-year profit this morning, which lifted its shares two per cent.
Headline mining shares followed suit, with gold miner Randgold Resources up 0.9 per cent, Fresnillo up 0.6 per cent and Xstrata rising 0.2 per cent.
In Asia, the Nikkei closed down 2.26 per cent and in the US, the Dow Jones closed down 1.55 per cent.