The biggest faller in early trading (at 1011) was interdealer broker ICAP (ICAP.L) falling by 4.1 per cent to 426.3p

The City-based dealer was one of a number of companies operating within the financial sector who saw share prices drop after German leader Angela Merkel and French president Nicolas Sarkozy yesterday revealed plans for a financial transactions tax across the European Union.

Bank Barclays (BARC.L) dropped 3.3 per cent to 175.7p, financial services provider Hargreaves Lansdown (HL.L) fell 2.9 per cent to 444.6p, and insurer Standard Life (SL.L) slipped 2.8 per cent to 206.5p.

Engineer IMI (IMI.L) also dropped during the morning session, with share price down 2.9 per cent to 840.5p.

The biggest riser was Mexican silver miner Fresnillo (FRES.L), up 2.8 per cent to 1,900p as rising gold prices continued to boost precious metal miners.

Engineer GKN (GKN.L) was up 2.2 per cent to 202.8p, as life insurance consolidator Resolution (RSL.L) increased by 1.9 per cent to 273.1p.

Pharmaceutical company Shire (SHP.L) added 1.5 per cent to its share price, rising to 1,993p, while miner Eurasian Natural Resources (ENRC.L) climbed 1.4 per cent higher to 640.5.

To receive more relevant articles like this one, why not sign up to our weekly newsletters, click here