There were similar declines across Europe and America as shareholders fretted over the potential threat to economic recovery and on fears over the impact of Japan's disaster on global manufacturing supply chains.
The Dow Jones Industrial Average on Wall Street fell around 1.8%, while the Dax in Germany plunged 3% and France's Cac 40 was 2.5% down as investors dumped shares in tech and car manufacturer companies that rely on Japanese suppliers for parts.
Japanese stocks had earlier taken another hammering after the Nikkei closed almost 11% lower at a two-year low amid fears over the radiation leak at Japan's Fukushima plant panicked investors.
Japan's leading stock market has now suffered the worst two-day fall since the 1987 stock market crash.
Analysts said the need for Japanese investors to repatriate funds in advance of the country's rebuilding programme was also impacting world markets.
In addition, Bahrain's King Hamad added to the unease by declaring a three-month state of emergency in order to quell political unrest.
In currency news, the pound dropped against the US dollar, with the nuclear concerns triggering a flight to stronger currencies. Sterling fell to 1.61 dollars and 1.15 euros.
The uncertain global growth prospects impacted mining stocks, with Fresnillo the worst affected with a 66p drop to 1433p. For the latest updates PRESS CTR + D or visit Stock Market news Today
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