The FTSE 100 ended the first trading day of February in the red after data showed China's manufacturing sector had contracted at its fastest pace in three and a half years in January. The blue chip index fell 0.39% on Monday (1 February).
In the US, Wall Street stocks fell after the opening bell and Asian markets closed down as well. The Shanghai composite fell 1.8% after the Chinese manufacturing Purchasing Managers' Index (PMI) came in at 49.4, its lowest point since August 2012.
Markit's PMI, which indicates a contraction when reported below zero, signalled that the manufacturing slump in China is still a problem for the country. January's PMI also missed expectations of 49.6.
"Chinese manufacturers signalled a modest deterioration in operating conditions at the start of 2016, with both output and employment declining at slightly faster rates than in December. Total new business meanwhile fell at the weakest rate in seven months," Markit said in a statement.
At the London Stock Exchange, Premier Oil was by far the biggest riser, listed on the FTSE Small Cap. The oil company soared more than 120% and closed up 89.5% at the end of the its first trading day in almost three weeks.
Trading was suspended on 13 January after Premier Oil agreed to buy energy giant E.On's North Sea division. After talks with E.on, Premier Oil told investors the total costs would be $135m (94m, €124m ), less than expected.
Despite the massive surge, which resulted in Premier Oil shares being valued at 36p against the 19p opening price, shares were still down 25% from the start of 2016. Troubled Premier Oil is dealing with low oil prices and a £1.5bn debt.
FTSE 100 risers
INTERNATIONAL CONSOLIDATED AIRLINES +2.97
BT GROUP +1.97
ARM HLDGS +1.81
FTSE 100 fallers
STAND ARD CHARTERED -2.37
FTSE 250 risers
Premier Oil +89.47%
Home Retail +11.85%
Ao World +5.00%
FTSE 250 fallers
Kaz Minerals -4.58%
IP Group -4.46%