The FTSE 100 had dropped 1% to 6,533 early on after closing Thursday at a four-month low of 6,597.37.

The index has not closed below this mark since March 24th, though it had reached an intraday low of 6,507.08 on April 14th.

Stocks were under pressure on Thursday after Moscow announced a ban on food imports from the US and European Union in response to another round of sanctions on Russia.

Meanwhile, US President Barack Obama overnight authorised air strikes on Islamic militants in northern Iraq, saying that America could not turn a “blind eye” to what he called a “potential act of genocide” of the Yazidi people.

The move follows the seizure of Iraq’s largest Christian town by Islamic State (IS) fighters who have been taking control of large parts of northern Iraq since June.

“The geopolitical landscape already looks explosive with tensions rising in Ukraine and with Russia but the appearance of another flash point and the possibility of being drawn into something deeper in Iraq is set to drag sentiment even lower,” said Jonathan Sudaria, a dealer from Capital Spreads.

TUI Travel reports strong Q3 but shares drop

Travel tour operator TUI Travel declined despite saying it has delivered a strong result in the third quarter with like-for-like underlying profits up 21% on last year.

However, geopolitical concerns were continuing to weigh on the wider travel and leisure sector with Thomas Cook, IAG and Easyjet all registering steep losses on Friday.

Specialty property and casualty insurer Catlin was a bright spark in morning trade after reporting a 118% increase in interim profits before tax to $318m.

However, Africa-focused oil explorer Afren sank after saying it has temporarily suspended operations at its Barda Rash field in Iraq due to the heightened regional security issues. The company said that non-essential field personnel are being withdrawn in a phased manner.

Precious metals miner Fresnillo was making gains early on as gold and silver prices rose on the back of safe-haven demand. Even African Barrick Gold and Randgold Resources, which were trading slightly lower, were outperforming the wider market.

FTSE 100 – Risers
Fresnillo (FRES) 995.50p +1.53%
Morrison (Wm) Supermarkets (MRW) 167.60p +0.18%
Legal & General Group (LGEN) 238.00p +0.13%
ARM Holdings (ARM) 871.50p +0.11%
Standard Chartered (STAN) 1,213.50p +0.04%
Tesco (TSCO) 243.85p +0.02%

FTSE 100 – Fallers
Barratt Developments (BDEV) 324.40p -3.34%
Mondi (MNDI) 979.50p -3.02%
Ashtead Group (AHT) 854.00p -2.95%
International Consolidated Airlines Group SA (CDI) (IAG) 307.30p -2.81%
Schroders (SDR) 2,213.00p -2.68%
easyJet (EZJ) 1,207.00p -2.58%
Sports Direct International (SPD) 640.50p -2.36%
InterContinental Hotels Group (IHG) 2,185.00p -2.32%
Persimmon (PSN) 1,201.00p -2.28%
Shire Plc (SHP) 4,519.00p -2.19%

Source: ShareCast