The FTSE 100 Index eased off earlier lows but still ended the day down 37.10 points, or 0.6%, at 5,823 points, following this morning's foiled plan to blow up US-bound aircrafts.
British Airways fell 5.06% to 370.25p after it banned all hand luggage from planes leaving the UK, including items such as laptops and mobile phones.
Vodafone declined 3.86% to 112p after German peer Deutsche Telekom shocked the market with a warning on profits and a gloomy assessment of growth in its home market.
BP dropped 0.73% to 615p and Royal Dutch Shell declined 0.97% to 1,931p after US crude oil fell over a dollar to $75.34 a barrel.
More positively, International Power gained 3.35% to 316.50p after it said it had enjoyed a strong financial performance during the first half and expected more of the same for the full year.
In the US, the Dow Jones Industrial Average is little changed, up 3.12 points, or 0.03%, at 11,079.30 points.
Continental Airlines has fallen 2.5% to $23.59 and AMR has lost 4.1% to $19.49.
UAL, the parent of United Airlines, has fallen 3% to $23.14 and Boeing has lost 2.1% to $75.49.
ImClone Systems has fallen 10.9% to $28.84 after the company said its board of directors completed a review of its strategic alternatives and the company decided to remain independent.
Shares of AIG have added 2.2% to $59.77.IFAonline
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