In London, the FTSE 100 index has shed 64 points or 0.9% to 7388.

EasyJet is one of the big fallers, down 3%, after rival budget airline Ryanair announced plans for price cuts this summer.

Joshua Mahony of IG: "The FTSE has suffered a rude awakening to the new week, with the gains of last week clearly left in the rear-view mirror. One of the biggest drags we have seen has come from the airline sector, with Ryanair’s warning of a potential air fare war in the coming months leading to sharp falls for easyJet and IAG, the owner of airlines including British Airways, Iberia and Aer Lingus.

This morning the IMF cut its growth forecast for the UK for the first time since the EU referendum over a year ago. Chief amongst its concerns is the tepid economic performance seen in the first quarter of 2017, with the enactment of Article 50 coinciding with a deterioration in both business and consumer confidence."