The London market fell back below the 5200 mark today amid falls for retailers and concerns over US earnings reports.
Marks & Spencer topped the FTSE 100 Index's fallers board, with a 4% decline, closely followed by Next, down 3%, in the wake of weaker-than-expected inflation figures and a British Retail Consortium (BRC) warning of "volatile" consumer confidence.
The Footsie closed down 56 points at 5154.2 having turned down sharply in tandem with US markets.
Wall Street was in the red today after an analyst downgrade of Goldman Sachs, while consumer healthcare company Johnson & Johnson also disappointed investors with declining third-quarter sales.
London's blue chip index closed above 5200 for the first time in more than a year yesterday.
Tim Hughes, head of sales trading at IG Index said the major influence today was the downgrade for Goldman, which is due to report on Thursday, but he said the market could bounce back.
Financial stocks were on the back foot today, led by Barclays, which fell 3%, or 12.65p to 360p.
Lloyds Banking Group also declined, losing 2% in the wake of a Daily Telegraph report suggesting it would have to pay the Government a break fee of more than £1bn (€1.07bn) to withdraw from its asset protection scheme.
Shares were down 1.89p to 89.72p after Lloyds confirmed it was in talks to sell its Halifax Estate Agencies business.
M&S led the Footsie fallers on the day its senior executives were meeting investors to outline their plans for the business. Shares lost 15.5p to 346.9p.
Next was also gloomy - down 53p to 1754p.
The BRC today reported a 2.8% rise in like-for-like sales last month, but said this was against comparisons with collapsing sales a year earlier at the height of the financial crisis.
Leisure group Whitbread enjoyed a gain today after resilient results. A strong performance by coffee chain Costa and recent improvement from its Premier Inn budget hotels helped the firm post better than expected results through the worst of recession. Shares rose 6p to 1296p.
Outside the top flight, ITV shares ended nearly 7% ahead - up 3.22p to 50.55p - after it completed a £135m (€144.7m) bond issue and said advertising revenues continued to show signs of improvement. Analysts said the bond issue showed the company was still functioning despite its leadership crisis.
Building firm Carillion meanwhile added 1p to 288p after confirming a support services deal with BT worth a potential £1bn (€1.07bn) over seven years.
But housebuilder Bellway dropped 11.5p to 794p as investors took profits after better than expected annual results. The firm is spending £120m (€128.6m) on new land and slashed debt by more than £180m (€192.9m) to strengthen its balance sheet.
The biggest Footsie risers were Smiths Group up 20p to 945p, Lonmin up 31p to 1640p, British American Tobacco up 24p to 1979p and Fresnillo up 9p at 837.5p.
The biggest Footsie fallers were Marks & Spencer down 15.5p at 346.9p, Barclays down 12.65p at 360p, Smith & Nephew off 17.5p at 532p and Next down 53p at 1754p.