The FTSE 100 index closed down 88 points or 1.2% at 7,351.31 on Thursday, its lowest level in two weeks. The decline was broad-based, with the energy sector leading the charge lower. BP and Royal Dutch Shell were among the biggest decliners, falling 3.5% and 3.2%, respectively.
The financial sector also contributed to the sell-off, with banks such as Barclays and HSBC slipping 2.4% and 2.1%. Analysts attribute the decline in investor sentiment to growing concerns about global economic growth prospects, particularly in China.
According to a report by Bloomberg, China's exports have slumped to their lowest level in four years, sparking worries that a trade war between the US and China could escalate further. This has sent shockwaves through financial markets, with investors becoming increasingly risk-averse.
In related news, the pound has weakened against the dollar, trading at 1.2777, down from 1.2839 on Wednesday.