The FTSE 100 fell 1.4 percent by 0839 GMT, a fall broadly in line with European benchmarks, all retreating after the S&P 500 and the Nasdaq plunged in New York overnight.

"The bloodbath for global equities comes as investors adjust to a world of higher US interest rates", said Jasper Lawler from London Capital Group, explaining that investors were switching bets on so-called growth stocks, like America's Facebook or Amazon to "more conservative strategies".

"To say risk appetite has taken a hit would be an understatement", he added.

Recruiting firm Hays posted the worst performances of the pan-European STOXX 600, sinking 12.7 percent, after reporting a slower quarterly fee growth rate, hurt by a relatively stronger pound against other foreign currencies.

British fund supermarket Hargreaves Lansdown was also among the big losers of the day, retreating 4.8 percent  after a trading update which suggested a slower start to the financial year.

Books, newspaper and stationery retailer WH Smith took a big hit, down 10.4 percent, after it unveiled plans to restructure its high street business to face lower consumer spending and lingering economic uncertainties.

Oil majors also contributed to drag the index down as oil fell to two-week lows with prices also hit by the storm on Wall Street and an industry report showing US crude inventories rose more than expected. BP lost 2 percent and Royal Dutch Shell 2.2 percent.

Losses were exacerbated by the fact that a number of stocks, such as Barratt Develoment, Centrica, HSBC and Tesco, were trading without entitlement to their latest dividend pay-out.