The FTSE 100 fell one per cent on the first morning of April as G20 demonstrations distracted traders.
At 8:36 BST, the FTSE 100 was down 1.06 per cent to 3,884.56 a fall of 41.58 points.
The drop followed yesterday's rally, which saw the index climb to give March an overall rise of 8.28 per cent.
The London drop came despite the Dow Jones rising 1.16 per cent last night in New York and Tokyo's Nikkei rising 2.99 per cent.
Lloyds Banking saw the biggest drops this morning down 5.52 per cent to 66.80p, despite comments from the chairman Sir Victor Blank defending the purchase of HBOS stating the bank was in position to create the "largest financial provider in the UK".
BT group was down 4.35 per cent, while miners Anglo American and Antofagasta fell 3.71 per cent and 3.52 per cent respectively.
Vodafone recorded the biggest gains up 2.61 per cent, followed by water company Pennon climbing 1.73 per cent as water rates rose.
Compass was up 1.02 per cent and Balfour Beatty rose 0.99 per cent.