The FTSE continues to fall, weighed down by fears over the global economic recovery and a massive sell-off in BP shares.
At 10.08 am BST, the index was down 2.23% or 115.95 points to 5,072.48
as slowing Chinese factory output fuelled pessimism over global economic recovery.
The European Central Bank also added to the gloom as it warned eurozone lenders face another wave of potential writedowns.
BP sank 12.42% to 433.35p after its latest failure to control its oil spill in the Gulf of Mexico. Royal Dutch Shell was also a big loser, its A shares down 2.03% to £17.86, while the B shares dropped 1.91% to £17.18.
Prudential was the day's biggest winner on news its attempts to renegotiate the AIA have been turned down. It advanced 3.79% to 562p.
In Europe, Germany's Dax is down 2.07% to 5,840.94, while the French Cac 40 has fallen 2.64% to 3,415.09.
In the US, Wall Street was closed for Memorial Day. On Friday it closed down 1.19% or 122.36 points to 10,136.63 on news Spain had its credit rating downgraded a notch by Fitch to AA+.
In Japan, the Nikkei closed down 0.58% or 56.87 points to 9,711.83 following holidays in both London and New York.
Companies with ties to China lost ground amid concerns about a slowdown in its economic growth.
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