The slide was exacerbated, dealers said, by revived concerns about the risk of yet higher interest rates, as well as sparse business as the market wound down to the end of the quarter and fiscal year.

Prospects for opening losses on Wall Street helped add to the negative tone, with the Dow Jones average seen starting around 50-60 points lower and the tech-laden Nasdaq Composite seen extending Wednesday's 3.9 percent drop.

Falling telecom stocks delivered 82 points of the FTSE 100's decline, while the loser board was dominated by sharp falls in leading tech names such as handheld computer maker Psion, biotech group Celltech and IT services group Logica.

Dealers said the Psion loss was exaggerated by comments from U.S. Rival Palm Inc of rising costs that would lead to operating losses for several quarters.Index heavyweight Vodafone, the mobile phone company which is Britain's biggest stock, lost 4.4 percent to account for 43 points of the FTSE's loss.

Tech and related stocks were undermined by the latest tumble in the U.S. Nasdaq index, due in part to comments from influential money manager Mark Mobius, who added his voice to those who have been concerned about lofty tech valuations.Mobius said recent volatility in the sector could be the start of a global selloff for technology stocks.

Market worries were also stoked by reports that Tiger Management LLC, the once high-flying U.S. Hedge fund manager that took huge stock and currency bets, is to close its flagship Jaguar fund due to ill-timed stock picks.Sources said Tiger's assets had fallen in the past 18 months to about $6.5 billion pounds from $22 billion as a string of bad investment decisions piled up losses and angered investors.