Airline shares hit by Ebola fears

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(Close): Shares in airlines have fallen sharply on worries that demand for travel will be hit by news of an Ebola case in Madrid.

British Airways owner IAG fell 6.9% and Easyjet shares dropped 5.3%. Worries over the possible impact on travel also hit Intercontinental Hotels, down 3.7%.

IAG and Carnival were the biggest fallers on the FTSE 100, with the index down 68.07 points at 6,495.58.

Investor confidence was also hit by gloomy figures from Germany.

Official figures showed that German industrial production shrank 4% in August, the biggest fall since early 2009.

European markets also closed lower, with Germany's Dax index down 1.3% and France's Cac 40 dropping 1.8%.

However, the mining sector was enjoying a strong day following news of Glencore's bid for Rio Tinto.

Rio Tinto shares closed 0.8% higher after the mining company said it had rejected a takeover bid from Glencore.

Shares in Glencore fell 2.5%, but among other mining firms Anglo American climbed 2% and Randgold rose 0.02%.

In the FTSE 250, shares in Cairn jumped 2% after the company said that it, together with joint venture partners, had discovered oil in a well off the coast of Senegal.

But shares in telecoms testing firm Spirent Communications sank 21.8% after it said third-quarter revenues were only expected to see a small rise.

"Trading conditions softened in the latter part of the third quarter in the United States and China," Spirent said.

"Demand levels dipped sharply as a result of merger activity and delays in capital expenditure."

On the currency markets, the pound fell 0.02% against the dollar to $1.6083 but rose 0.15% against the euro to €1.2729.