LONDON - The leading share index closed 2.5 percent lower on Thursday, with market sentiment hit by data showing U.S. employers cut more jobs than expected in June and unemployment in Europe hit a 10-year high.
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The FTSE 100 <.FTSE> index ended down 106.44 points at 4,234.27 after closing 2.2 percent higher on Wednesday, the first day of the new quarter.
Data showed the world's biggest economy lost 467,000 jobs in June, 100,000 more than expected by economists and breaking a four-month trend of slowing U.S. job losses.
"This proves that we may not be at the bottom yet. The world's biggest economy, as we know them, is going to be dragged down," said Philip Gillette, a sales trader at IG Index.
The energy sector, which gained in the previous session on higher oil prices, took the most points off the index as crude fell more than $2 to trade below $67 a barrel.
BP
"Sentiment has changed over the last two or three weeks, from being very bullish to people realising the fundamentals are not that rosy," said Gillette.
Lower metal prices helped push miners down, shedding some of the recent gains. Randgold Resources
Rio Tinto fell 5.7 percent. It completed the British leg of its $15.2 billion (9.3 billion pound) rights offer, putting the world's top iron ore miner back into growth mode after slashing its debt.
UNEMPLOYMENT RISES
Shares in British banks rose on the FTSE 100 in morning trading following positive news on the Greek debt crisis.
Unite, the union, has gone to international unions, in its attempts to bring the...
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