Travel stocks were hit hardest by the attacks, with budget airline EasyJet finishing towards the bottom of the FTSE 100, down 3.2 per cent, or 45p, at 1344p.
Rival Ryanair was down 0.6 per cent, or €0.10, to €18.14, while bus operator Stagecoach fell 1.6 per cent, or 3.5p, to 210p.
Leisure stocks also suffered, with theme park operator Merlin Entertainments down 2.4 per cent, or 13p, to 524p, while SSP, which runs bars and cafes in airports and train stations, fell 2.2 per cent, or 10.8p, to 476.7p.
Descent: Travel stocks were hit hardest by the attacks, with budget airline EasyJet finishing near the bottom of the FTSE 100, down 3.2 per cent, or 45p, at 1350.8p
Meanwhile, Premier Inn-owner Whitbread fell 2.6 per cent, or 109p, to 4116p, and Intercontinental Hotels, which runs Holiday Inn, fell 1.4 per cent, or 61p, to 4407p.
Justin Urquhart Stewart, co-founder at Seven Investment Management, said terror attacks tend to hit leisure stocks harder than others.
He said: ‘From hotels to holidays to entertaining, failing confidence will result in falling spending, and falling spending will result in a weakening economy.’
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Meanwhile, Kallum Pickering, senior UK economist at Berenberg, said that while the attack has weighed on tourism companies, it shouldn’t hurt the UK economy as a whole.
Indeed, outside of the tourism sector, the pound recovered early losses to finish up 0.2 per cent against the dollar, while the price of gold, typically used by investors as a safe haven in times of stress, rose just 0.1 per cent.
But the FTSE 100 began election week on a sour note, falling 0.3 per cent, or 21.87 points, to 7525.76.
STOCK WATCH – ECO ANIMAL HEALTH
Pharmaceutical firm Eco Animal Health hit an all-time high yesterday after winning approval for a drug to treat chickens laying eggs for human consumption.
The drug, used to treat chickens infected with a bacteria called Mycoplasma, was approved by a Malaysian pharmaceutical regulator.
Eco will pursue approval for the drug in a number of other markets, after winning a European licence in June last year.
Shares in the firm rose 1.7 per cent, or 10p, to 615p.
In a day of little positive company news, Royal Mail emerged as one of the winners after selling two plots of land to US developer Greystar for £101million.
The 2.67 acres are part of Royal Mail’s Nine Elms site, one of three former mail centres in London the firm is planning to sell to cut its debt.
Royal Mail will make a tidy profit from the sale, previously valuing the land at just £12.9million. Shares rose 0.2 per cent, or 0.9p, to 440p.
Telford Homes also rose during the day’s trading after revealing that Greystar had already commissioned it to build 894 build-to-rent homes on the newly-purchased site.
However, shares reversed gains to finish down 0.2 per cent, or 0.75p, at 407.25p.
HSBC analysts gave copper miners a hard time yesterday on the back of concerns over a 3pc drop in the price of copper since April.
Copper prices have been falling on the back of concerns that too much of the metal is being produced in China. Yesterday, they were down by more than 0.6pc.
This led HSBC to cut Antofagasta to ‘reduce’ from ‘hold’ and slash its target price to 730p from 760p, sending shares in the firm down 3.5 per cent, or 28.5p, to 776.5p.
It also cut Kaz Minerals to ‘reduce’ from ‘hold’, which led the FTSE 250-listed firm to fall 4.7 per cent, or 23.2p, to 471.2p.
Advertising firm WPP saw shares fall despite buying a consultancy firm which counts Real Madrid football club among its clients.
Wunderman, one of WPP’s subsidiaries, acquired Spanish digital agency The Cocktail as part of plans to build its European and Latin American presence.
But WPP continues to face a backlash over the pay of boss Sir Martin Sorrell, the highest paid man on the FTSE. Sorrell, who took home £70million in 2015, is expected to face another pay revolt at WPP’s annual meeting on Wednesday.
Shares in WPP fell 1.1 per cent, or 20p, to 1734p.