The London market endured heavy losses on Friday as America's stand-off with North Korea inspired another round of selling.
The FTSE 100 Index closed down 79.98 points to 7,309.96, with President Donald Trump tweeting that the US military is "locked and loaded" as he warned North Korea over its continuing threats.
American and South Korean officials said they would move forward with large-scale military exercises later this month, which North Korea claims are a rehearsal for war.
The slump comes after more than £27 billion was wiped off the value of blue-chip stocks on Thursday, sending the FTSE 100 to its biggest daily fall since April 18 this year.
Gold enjoyed another strong session as traders sought out safe havens, with the price lifting 0.1% to 1,287.8 US dollars an ounce.
David Madden, market analyst at CMC Markets, said: "Stock markets in Europe are still feeling the pressure from the tension surrounding North Korea.
"When President Trump declared that the US is 'locked and loaded should North Korea act unwisely', investors became even more fearful.
"For the time being, tensions seem to be going one way, and equity markets are losing ground because of it.
"The high drama has prompted traders to take their cash out of stocks, and invest it in safer assets like gold."
Across Europe, the Cac 40 in France slid 1.1% while Germany's Dax was flat.
On the currency markets, sterling rose 0.2% to flit around the 1.30 US dollar mark, with the greenback falling in response to the latest US inflation data.
The US Consumer Price Index (CPI) edged up 0.1% last month after staying flat in June and falling by 0.1% in May.
The pound was down 0.1% against the euro at 1.10.
In oil, the price of Brent crude sunk by 0.5% to 51.65 US dollars a barrel amid concerns about over supply in the market.
The International Energy Agency said Opec members were not complying with production cuts, which were holding back efforts to rebalance the market quickly.
Focusing on UK stocks, Old Mutual was among the biggest fallers after saying it was taking a "cautious" approach to the dividend despite hiking half-year profits.
The FTSE 100 firm announced in March last year that it would run its US-based asset management operation, its UK-based wealth unit, an emerging markets division and Nedbank in South Africa as separate businesses.
On Friday, chief executive Bruce Hemphill said Old Mutual is making "excellent progress" in the break-up as he celebrated a 37% rise in adjusted operating profit to £969 million.
Shares were down more than 3%, or 6.2p to 195.3p.
On the second tier, Domino's Pizza dropped 8.3p to 272p after the takeaway firm inked a partnership with its London franchise business.
The group said it will pay £24 million for the stake in the firm, which will consist of 25 existing Domino's stores in the capital.
The biggest risers on the FTSE 100 Index were Smurfit Kappa up 38p to 2,224p, Persimmon up 39p to 2,501p, DCC up 70p to 6,885p, Barratt Developments up 6p to 595.5p.
The biggest fallers were Standard Life down 16p to 410.8p, Rio Tinto down 109.5p to 3,370p, Old Mutual down 6.2p to 195.3p, Anglo American down 39p to 1,238.5p.