Leading shares continued their volatile week, falling for the second day running, but ending off their worst levels.
Ahead of the US Federal Reserve minutes and the start of the US reporting season with Alcoa, investors remained concerned about prospects for the global economy in the wake of poor German data on Tuesday and the IMF cutting its growth forecasts. Weak Chinese service sector data did not help matters.
The troubles in Ukraine and Iraq also unsettled the markets, while the spread of the Ebola virus to Spain continued to hit the travel sector.
But with Wall Street edging higher by the time London closed, the FTSE 100 finished 13.34 points lower at 6482.24 after earlier falling as low as 6453. Brenda Kelly, chief market strategist at IG, said:
Day three of the global growth scare sees indices struggling to hold their ground. Bonds have become the destination of choice once again as the equity bull market faces its most serious test in months. The danger is now that a hawkish set of Fed minutes, pointing to an earlier hike in rates, could easily put markets into a tailspin from which they could struggle to recover.
Engineering group GKN lost 10.7p to 294.7p following a downgrade from Bank of America Merrill Lynch, which moved from buy to underperform and slashed its price target from 420p to 290p.
Following the continuing concerns about the effect any spreading of the Ebola virus could have on the travel industry, Tui Travel dropped 15p to 367p while British Airways owner International Airlines Group slipped 2.3p to 343.3p and cruise company Carnival lost 29p to £22.99.
But after its recent slump, Tesco recovered 2.5p to 185.1p as analyst Dave Mccarthy at HSBC raised his rating from underweight to neutral and his price target from 175p to 195p.
ITV added 1.4p to 205.8p as Credit Suisse said it could return cash to shareholders, and highlighted than any potential bidder for the broadcaster would have to pay more than 346p a share. The bank put an outperform rating on ITV with a target price of 270p,
Among the mid-caps, FirstGroup fell 5.6p to 109.5p after it announced an inline trading statement but the loss of the ScotRail franchise.
Interserve, the building services and construction group, rose 22.5p to 610.5p after Peel Hunt moved from hold to buy. Analyst Andrew Nussey said:
While the group's diverse nature leaves us with a few concerns (as does the strategic merit of the acquisition of Initial), we believe that the potential for positive earnings momentum is building. Allied to this, the recent de-rating looks to have been overly harsh as visibility rises. Therefore, with the shares trading on 9 times December 2015 estimates, we upgrade to buy (retaining our 650p target price) in anticipation of a strong finish to 2014. The interim management statement is due on 12 November.
But Spirent Communications fell another 5.9p to 71.20p in the wake of the telecoms testing company's disappointing update on Tuesday.
In the mining sector, platinum producer Lonmin added 2.7p to 173.2p after saying it had returned to full production earlier than expected, following a five month wage strike in South Africa which ended in June. It said output for August and September were higher than the same time in 2013, saying that from August onwards it had achieved production at normal levels.
But lower down the market, London Mining, the debt laden West Africa focused iron ore group, has lost 75% of its value,, down 2.35p to 0.75p, as it warned a proposed restructuring could potentially leave shareholders with nothing.
