The FTSE 100 fell 0.85% or 46.36 points to 5,392.83 this morning with Barclays among the biggest losers.
Investors are wait to see how Wall Street reacts to President Obama's infrastructure plans, including an initial $50bn injection. The US market will reopen this afternoon after being closed yesterday due to the Labor Day public holiday.
In London, Barclays was one of the biggest losers following the announcement chief executive John Varley is to be replaced by Bob Diamond. Its shares shed 3.69% to 310.95p.
Other fallers on the index include Man Group, down 4.33% to 225.2p, while Eurasian Natural Resources fell 2.57% to 853p.
Meanwhile, Invensys led risers, advancing 4.39% to 261.6p, followed by Tullow Oil, up 2.45% to £12.11.
In Japan, the Nikkei 225 slipped 0.81% or 75.32 points to 9,226 after investors took profits after recent gains.
View from the front row
Project Libra unveiled
Including SJP and investment trusts
Spent two years at Sanlam
Will also assess FCA's actions