The FTSE share index extended losses in midmorning trade on Thursday, with banks and miners among the top fallers as Europe's finances emitted further strains after France's debt auction.
London's blue chip index <.FTSE> was down 43.15 points, or 0.8 percent at 5,625.30 by 10:58 a.m. BT as investors withdrew funds out of riskier assets.
In auction of 4.02 billion euros of 10-year OAT bonds, France drew bids worth 1.643 times the amount on offer, down from 3.046 times in December, with yields up to 3.29 percent, from 3.18 percent last month.
The debt auction by France, whose triple-A credit rating is under threat, followed a subdued German Bunds auction and a deeply discounted rights issue from Italy's UniCredit
in euro zone finances and firm's heavily exposed to its problems.
Stefan Angele, head of investment management at Swiss & Global Asset Management which has assets under management of about 75.7 billion swiss francs, said: Our baseline scenario of weaker economic growth but no recession only holds if we see no major shock in the financial sector.
In this context, we must focus on the public debt crisis in the industrialised world and particularly Europe, which currently poses the biggest threat to the global financial system.
Lloyds Banking Group
Among the miners, whose earnings rely heavily on companies and governments willingness to dip into their wallets spend on future developments, Kazakhmys