In Russia, the Micex tumbled as much as 5.3pc before recovering some ground and closing down 0.9pc.

With investors shying away from riskier equities, safe-haven gold climbed to its highest level for six months.

Mounting concern about both Russian intervention in Ukraine and the Chinese economy have driven the flight to safety. Investors are bracing for tomorrow’s vote on whether Crimea will secede from Ukraine to Russia. The crisis has ratcheted up tensions between the West and Russia, a key supplier of energy to Europe.

At the same time, investors are worried about the health of the Chinese economy – the world’s second-largest – after recent data pointed towards a slowdown.

China also experienced its first corporate bond default earlier, and commodities traders are concerned that more could follow, putting pressure on the price of copper. The metal is typically used as collateral for Chinese financing deals and further defaults would spur heavy selling of the commodity

“It looks as if there are strains emerging in its formal and shadow banking systems,” Douglas McNeill, investment director at broker Charles Stanley, said of China.