The London market slipped below the 6,000 mark today after disappointing US jobs data sparked fears over the strength of the recovery in the world's biggest economy.
The US Labor Department said the number of non-farm jobs created last month was just 18,000, against forecasts of 120,000.
The FTSE 100 Index had been up nearly 30 points in early trading but surrendered its gains following the announcement and slipped into the red, closing down 64 points at 5990.6.
The pound was up against the dollar, at 1.60, after the disappointing jobs data caused the greenback to lose its value. Sterling was also up against the euro, at 1.13, after concern over the strength of Italian banks hit the single currency.
The poor US data briefly turned attention away from BSkyB, which sank to the bottom of the FTSE 100 Index after the Government said today it would take "some time" to reach a decision on whether News Corp's proposed bid for the satellite broadcaster could proceed.
BSkyB shares fell nearly 8%, or 62p, to 750p after the Department for Culture, Media and Sport said it would take as much time as it needed to decide if it should refer the proposed deal to the Competition Commission.
The DCMS has received more than 160,000 responses to its consultation on the News Corp approach - with a surge of interest in the last few days driven by the unfolding phone-hacking scandal at the News of the World.
Elsewhere, shares in two of Britain's largest newspaper groups posted strong gains amid speculation their publications will benefit from the shock closure of the best-selling Sunday paper.
Trinity Mirror saw shares climb 4%, or 2p, to 50p after News International last night announced the paper's end, while the Daily Mail & General Trust was up 0.4p at 473.6p.
Both groups are reported to be ramping up their print runs for Sunday, while Trinity Mirror, which publishes the Sunday Mirror and The People, saw its stock upgraded from hold to buy by brokers at Deutsche Bank following the move.
Deutsche Bank said if 10% of News of the World's circulation moves across, it could add 10% to Trinity Mirror's earnings.
Elsewhere, analysts at broker Peel Hunt said DMGT, which publishes the Mail on Sunday, is likely to see a short term boost to revenues.
Smiths News, the UK's leading newspaper distributor, today reassured that the "unprecedented" closure of the News of the World would not hit its business. But investors were not convinced and the stock fell 2.5p to 87.5p.
Primark owner Associated British Foods topped the blue chip index risers' board, adding 18p at 1092p ahead of next week's trading update. It also benefited from news that factory gate price inflation was slowing.
The biggest Footsie risers were Associated British Foods up 18p at 1092p, Man Group ahead 3.9p at 259.6p, Tesco up 4.4p at 411.5p, and British American Tobacco ahead 22.5p at 2847p.
The biggest Footsie fallers were BSkyB down 62p at 750p, Antofagasta off 67p at 1424p, Vedanta Resources down 88p at 1973p, and Arm Holdings off 26p at 611p.