THE FTSE 100 fell to the lowest level in almost three months yesterday as disappointing US employment figures dragged shares lower.
London's leading index was as much as 60 points higher in early trading but plunged down 71.7 points at 5,145.7, its lowest close since 6 November.
Mining companies were dragged down as base metal prices dropped on fears of a tightened money supply in China, which is indicating a determination to curb growth to prevent the economy overheating.
Dan Smith, an analyst at Standard Chartered, said: "Chinese monetary tightening is one of the main things for the metals market".
Xstrata was one of the index's biggest fallers, closing down 45.5p at 1,004.5p, while Antofagasta was down 35.5p at 885.5p.
Rival Fresnillo, the world's largest silver producer, managed to climb, as a weaker US dollar pushed up the price of precious metals. The Mexican company was one of the FTSE 100's few risers, climbing 5p at 677p.
The biggest fall in the top flight came from pharmaceutical giant AstraZeneca, after analysts expressed disappointment at the content of the drug company's annual results, particularly its guidance for 2010 earnings.
AstraZeneca is stepping up its efficiency drive with another 8,000 job cuts over the next four years, but this was not enough to prevent shares from falling 5 per cent or 140p to 2905p.
International Power dropped 1.7p to 317.5p despite comments from the vice-chairman of GDF Suez Jean-Franois Cirelli, indicating that the company had not ruled out further talks with the UK utility.
Negotiations about a merger broke down earlier this month.
Oil shares were lower, after comments from the chief economist at the International Energy Agency predicting that new efficiency measures meant demand for oil among developed nations would never return to levels seen in 2007 and early 2008. Crude oil initially rose after US president Barack Obama's State of the Union speech appeared to soften attacks on the banking sector, but closed down on demand fears.
Cairn Energy, Scotland's largest explorer, fell 9.2p to 321.9p despite reassuring the market that a crucial Indian pipeline is on schedule.
BP fell 7.1p to 587p, Royal Dutch Shell dropped 40p to 1,662.5p and Tullow closed 14p lower at 1,148p.
BSkyB was among early risers after it reported a 4 per cent rise in half-year profits to 401million, but shares failed to hold onto the gains, falling 14p to 540p by the close.
Outside of the top flight, shares in sugar producer Tate & Lyle fell 5 per cent after it said full-year operating profits were likely to be marginally below last year. The group, which recently dropped out of the FTSE 100, fell 18.4p to 388.7p.
Transport firms dominated the second-tier risers' board after Arriva announced it was in merger talks with European bus and coach operator Keolis.
Arriva shares rose 13.5p to 481.4p, while hopes for further consolidation lifted National Express 6.5p to 212p.
Robert Wiseman Dairies climbed after announcing an earlier than expected dividend payment, promising profits for this year would be ahead of expectations. Shares in the East Kilbride headquartered company closed 2.8 per cent higher at 490p as Panmure Gordon reiterated its "buy" recommendation.
Faroe Petroleum climbed 6.6 per cent to 136.5p after the UK government announced that tax relief would be extended to cover the frontier West of Shetland region, where the Aberdeen-based explorer has a large position.