LONDON: Weaker mining and banking stocks kept Britain's top share index mired near three-year lows on Tuesday as concern lingered over the global economy and the health of the financial sector.
The FTSE 100 index, was down 1 percent at 5,632.19 points at its close, near its lowest for about three years and down 20 percent from its record high of 7,122.74 in April 2015. It has lost nearly 10 percent since the start of 2016.
Signs of a global economic slowdown have hit world stock markets since the start of the year, and raised concerns about the stability of the European banking system.
Heavyweight Barclays fell nearly 5 percent and HSBC fell 1.4 percent.
Mining stocks also fell sharply, with Anglo American down more than 11 percent after its Kumba division posted lower profits, while Antofagasta declined 9.4 percent after Goldman Sachs cut its rating on it to "sell".
"There are worries about global growth, and fears of a recession are starting to emerge. The banks are getting hit hard," Berkeley Futures associate director, Richard Griffiths, said.
Goldman Sachs analysts wrote that while there were no signs of any strain in terms of euro or U.S. dollar funding in money markets, market liquidity had nevertheless reduced.
Exane BNP Paribas cut its price targets on Barclays, HSBC, Lloyds, Royal Bank of Scotland and Standard Chartered, citing the pressures on the sector.
Among standout gainers, shares in WPP bucked the trend, rising 3.4 percent after Monday's sell-off as JPMorgan made a case for a higher valuation, citing resilient earnings per share growth at the world's largest advertising company.
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