The FTSE 100 index of leading British shares fell 3.5 percent in the first half hour of trading Thursday on the London Stock Exchange Thursday because of fears of a global recession.
The decline brought the FTSE down to 3,937 points from a closing value of 4,080 on Wednesday. Just one week ago, the FTSE had not fallen below the 4,000 mark in five years.
The falls hit nearly all sectors, with horse racing company Arena Leisure PLC losing 26 percent and construction firm Travis Perkins PLC falling 19 percent.
There were similar losses across Europe _ Paris's CAC 40 dropped 5.6 percent to 3,193 and Germany's DAX fell 5.7 percent to 4,586.
Earlier, Tokyo's leading Nikkei index closed down more than 11 percent.
