Stock prices in London following Europe into the red, as rhetoric from Russian President Putin claiming that there would be no let up in the Ukraine invasion further dented already fragile hopes of progress in diplomacy.
The FTSE 100 index shed 190.71 points, or 2.6%, at 7,238.85. The mid-cap FTSE 250 index lost 696.12 points, or 3.4%, at 20,079.70. The AIM All-Share index ended down 23.05 points, or 2.2%, at 1,004.64.
The Cboe UK 100 index ended down 2.7% at 720.29. The Cboe 250 closed 3.7% lower at 17,729.48, and the Cboe Small Companies lost 1.2% at 14,571.02.
In mainland Europe, the CAC 40 in Paris closed down 1.8%, while the DAX 40 in Frankfurt lost 2.2%.
The FTSE 100 and DAX 40 looked set for more modest declines on Thursday, while the CAC 40 in Paris was in the green for most of the afternoon.
After the fall of a first major Ukrainian city to Russian forces, Putin appeared in no mood to heed a global clamour for an end to hostilities as the war entered its second week.
A first round of talks on Monday yielded no breakthrough, and Kyiv says it will not accept any Russian ‘ultimatums’.
Putin, however, said any attempts to slow the talks process would ‘only lead to additional demands on Kyiv in our negotiating position’.
The pound was quoted at $1.3341 late Thursday, down from $1.3363 at the London equities close Wednesday.
The euro was priced at $1.1047, down from $1.1130 as the Ukraine conflict sparked concerns over the eurozone's economic recovery from the pandemic. The euro fell to an intraday low of $1.1038 on Thursday, its weakest level since May 2020.
Against the yen, the dollar was trading at JP¥115.63 in London, higher against JP¥115.60 late Wednesday.
Brent oil hit an intraday high of $119.84 a barrel - its highest level since 2012. The North Sea benchmark then faded to $113.62 a barrel at the London equities close on Thursday, up from $109.94 late Wednesday.
Gold stood at $1,928.05 an ounce, firm from $1,923.31 late Wednesday.
In London, travel, leisure, retail and Russia-exposed stocks largely struggled. As far the 100-strong blue-chip FTSE was concerned, only a handful ended in the green.
London Stock Exchange Group was the best of the bunch, adding 9.6%.
The stock exchange operator said its Refinitiv deal has been ‘successful’, with the firm's cost savings ahead of target amid burgeoning income that has led to increased shareholder payouts.
Total income in 2021 surged to £6.42 billion from £2.03 billion. Data & Analytics income ballooned to £4.29 billion from £824 million. Capital Markets income was up to £1.18 billion from £288 million, but Post Trade income was flat at £913 million versus £915 million in 2020.
Pro forma results - which assumes LSEG's Refinitiv acquisition took place at the start of 2020 - shows total income grew to £6.81 billion from £6.77 billion.
At the other end of the blue-chip index, ITV and Melrose disappointed, falling 28% and 8.4%.
Industrial turnaround firm Melrose posted a narrowed annual loss but delayed capital plans for amid the ongoing crisis. A ‘conservative’ decision, but one that disappointed investors.
ITV's earnings improved, but the broadcaster's plans to enter the streaming world, where it faces stiff competition from the likes of Disney, Amazon and Netflix, took some sheen off of its yearly results.
ITV unveiled plans to launch a new streaming service, dubbed ITVX, with new content launching online every week alongside a library of blockbuster movies.
AJ Bell analyst Russ Mould commented: ‘ITVX is not as revolutionary as the company might like you to believe. It is effectively offering viewers a chance to see some of its programmes before they are broadcast on linear TV as well as its back catalogue of shows.’
Gold miner Polymetal fell 42%, packaging firm Mondi dropped 5.6% and investment company JPMorgan Russian Securities shed 21% as Russia-exposed stocks continued to get the cold shoulder.
Budget carrier Wizz Air fell 6.3%, on fears of an informal no-fly zone.
High street retailer Superdry fell 7.9%, fast fashion company ASOS fell 3.7% and luxury brand Burberry gave back 3.8%. Moncler dropped 4.6% in Milan.
The conflict in Ukraine has ‘supercharged the inflationary pressures already facing the globe’, AJ Bell's Mould said, leading to further fears of consumer spending power.
Online marketing company dotdigital plunged 55% as it warned of slow growth. It sees an ‘unwinding’ of customer buying behaviour in a post-lockdown environment, as reduced growth in demand for SMS - or mobile text - marketing will hit growth.
Stocks in New York were weaker at the time of the closing bell in London. The Dow Jones Industrial Average and S&P 500 were both down 0.5%, while the Nasdaq Composite was 1.1% lower.
Fed Chair Jerome Powell testifies before Congress again on Thursday.
Appearing before US lawmakers on Wednesday, Powell said he was in favour of a moderate pace of rate increases, with a 25-basis-point lift this month.
However, surging oil prices are playing a major role in sending global inflation to the highest levels in decades, prompting fears central banks will tighten policy at a faster pace.
Friday's economic calendar has a UK construction PMI at 0930 GMT, eurozone retail sales at 1000 GMT and the latest US monthly jobs report at 1330 GMT.
The local corporate calendar has annual results from industrial products manufacturer Morgan Advanced Materials and property investor Hammerson.
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