Spanish and Italian bond prices have continued their decline as G20 leaders told European politicians responsibility for the debt crisis lies with them.
Standard & Poor's (S&P) has reaffirmed its AAA credit rating for the UK and forecasts the government's net debt burden will peak next year.
The FTSE 100 fell 50 points, or just under 0.9%, in early trading on Tuesday as investors got their first opportunity to act on a disappointing US jobs report on Friday.
London's leading share index edged closer to the 6,000 barrier today, as financials put the FTSE 100 on track for its sixth straight session of gains.