The FTSE 100 Index fell 117.9 points, or 2.1%, to 5533.9 amid worries that a raft of Spanish regions were poised to ask for government bailout funds, increasing the likelihood that the country itself will turn to the EU for help.
The fall wiped nearly £30 billion from the value of London's leading shares index, with all 100 companies losing value and banks falling up to 4%.
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Unusually windy for the time of year with gales and big waves battering western coastlines.
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Natalie Sharp and Christine Bicknell appeared in court over an alleged incident at a Lidl superstore in Wallington, south London.