The FTSE 100 is down almost 100 points in early trading with a fall of 92.3 points, or 1.43%, to 6,342.4, as the mining sector is suffering from a bout of profit-taking.
Reuters Group is the only stock making gains at the moment with a rise of 1.23% to 431.25p, while miners are making up the top five losing stocks with Xstrata acting as the biggest drag with a drop of 4.82% to £25.28.
BHP Billiton is down 3.97% to £10.76, closely followed by Vedanta Resources which has slipped 3.95% to £12.88, Rio Tinto has declined 3.81% to £28.28, and Lonmin is down 3.7% to £32.49.
In Japan, the Nikkei 225 Stock Average slipped 95.43, or 0.5%, to 18,119.92 at the 3pm close, as banks led declines on concerns a rate increase by the Bank of Japan last week won't be enough to boost profits.
Sumitomo Mitsui, the nation's third largest bank, dropped 30,000 yen, or 2.5%, to 1.16 million, while Mitsubishi UFJ Financial Group, the largest, fell 20,000 yen, or 1.3%, to 1.49 million, and Mizuho Financial Group, the second-largest lender, slipped 5,000 yen, or 0.6%, to 855,000.
Elsewhere Tokyo Electric, Asia's largest power producer, jumped 100 yen, or 2.4%, to 4,260, while Kansai Electric Power, the second-largest in Japan, advanced 50 yen, or 1.4%, to 3,670, and Chubu Electric Power, the nation's third biggest, rose 60 yen, or 1.5%, to 4,140.
Property developers also fell on the view share-price advances are not justified by their profit outlook, with Mitsubishi Estate slipping 120 yen, or 3.1%, to 3,790, while Mitsui Fudosan, Japan's largest property developer, dropped 100 yen, or 2.8%, to 3,470.
In the US the Dow Jones Industrial Average closed down 15.22 points, or 0.12%, to 12,632.26, as higher oil prices provoked concerns.
American Express was the biggest faller with a drop of 1.52% to $57.14, closely followed by Boeing which slipped 1.5% to $88.93, while Hewlett-Packard fell 1.3% to $40.29, and General Motors declined 0.85% to $33.97.
IBM also dropped 0.84% to $96.91, although there were some gains yesterday with drug company Merck up 3.59% to $44.48, while Pfizer added 0.86% to $25.84, AT&T climbed 1.35% to $37.50, and Coca-Cola gained 0.97% to $47.72.IFAonline
Three year strategic review
Has run Cautious Managed fund since 2011
What’s right – not what sells
Richards fires back at committee report
Available on Investcentre platform