Global markets turned lower following the US Federal Reserve's decision to hold interest rates in the world's biggest economy at close to zero left investors facing more months of uncertainty.

The FTSE 100 Index finished 82.9 points lower at 6104.1 during a turbulent session which saw it more than 100 points adrift for a spell.

Traders were left in limbo after the Fed's much-anticipated announcement offered little clue as to when a US rates hike will eventually come.

In Europe, Germany's Dax and France's Cac 40 were both down sharply while on Wall Street, the Dow Jones Industrial Average was more than 1% lower at the time of the close in London.

US rates have remained on hold since they were slashed by the Fed in December 2008 to support recovery and the policy has helped prop up stock markets - which have in recent months been anxious about signs it was about to end.

But market turmoil in recent weeks sparked by signs of a slowdown in China appears to have stayed the central bank's hand.

Connor Campbell, financial analyst at Spreadex, said it had disappointed markets as the "fog of uncertainty" still lingered over the timing of a hike with the Fed's latest statement failing to give any firm guidance.

In London, banks were among the fallers, with Barclays down 7.2p at 253.2p, Royal Bank of Scotland off 7.1p at 318.9p and HSBC falling 11.8p to 490.6p while Lloyds was 1.6p lower at 72.7p.

Lenders were hit as their profit margins would have been boosted in a higher interest rate environment.

Sterling initially climbed against the US dollar after the timing of a Fed decision was deferred but gave up the gains after Bank of England chief economist Andy Haldane said UK rates may need to be cut amid weak inflation and slowing growth.

The pound finished the session little changed against the greenback at just under 1.56.

However with speculation that the gloomy global picture that prompted the Fed not to raise rates could mean more eurozone stimulus, sterling was a cent ahead against the single currency at just under 1.37.

The fall in demand for the dollar also saw a rise in the gold price, pushing gold miners to the top of the FTSE 100 risers' board. Randgold Resources climbed nearly four per cent, or 134p, to 3863p, while Fresnillo added 20p to 610p.

Oil prices were lower, with a barrel of Brent crude dipping below 48 US dollars. Royal Dutch Shell fell 56.5p to 1599p while BP slipped 12.2p to 333.4p.

In corporate news, discount retailer Poundland climbed 3.2p to 321.2p in the FTSE 250 Index after its £55 million takeover of rival 99p Stores was given final clearance by the Competition and Markets Authority.

The biggest risers in the FTSE 100 Index were Randgold Resources, up 134p at 3863p, Fresnillo up 20p at 610p, AstraZeneca up 99.5p at 4370p and Sainsbury's up 3.3p at 228.3p.

The biggest fallers in the FTSE 100 Index were Glencore down 6.2p at 126p, GKN down 11.2p at 273.8p, BP down 12.2p at 333.4p and Royal Dutch Shell down 56.5p at 1599p.