The FTSE <.FTSE> ended down 1.1 percent at 7,138.78 points, while the mid cap index <.FTMC> fell 1.3 percent.

Trump replaced Tillerson with loyalist CIA Director Mike Pompeo which, together with U.S. inflation data, weighed on the dollar.

That boosted sterling to a two-week high, hitting the FTSE's international earners, in particular big consumer staples.

"Rex Tillerson being replaced by the director of the CIA, that's come as a shock to the market and it's sent cable higher which has suppressed the FTSE 100 throughout the day," Jasper Reimers, senior analyst at Vertex Capital Group, said.

"Rex Tillerson was the mediator in a lot of foreign policy issues, so with him now out of the picture, it looks as though Trump's agenda might be far easier to drive in."

A half-yearly update on Britain's economy from Chancellor of exchequer Philip Hammond also helped keep the pound firm as he raised his growth forecasts slightly.

Mid cap Greencore's (>> Greencore Group plc) shares plunged after the food manufacturer cut its 2018 profit guidance due to issues at its US business.

Investec placed its forecasts and price target under review, noting that even though commercial developments gave the group confidence that the financial performance will improve through into 2019, this was later than management had expected.

Greencore was down more than 30 percent, the biggest faller among mid caps and the stock's biggest one-day loss ever.

Still among mid caps, TC ICAP (>> TP ICAP PLC) fell 10.5 percent after annual profits at the world's largest interdealer broker fell short of analyst expectations.

"We believe various additional costs associated with MiFID II and ongoing investment account for the shortfall," Liberum said in a note.

On the FTSE, Antofagasta rose 3 percent following a well-received trading update.

The Chilean miner reported a sharp rise in full-year earnings thanks to higher copper prices and said it would raise its dividend 177 percent.

Tonic water maker Fevertree Drinks fell 3.6 percent after hitting a record high in the previous session as a 64 percent jump in full-year core earnings failed to excite investors.

(Reporting by Danilo Masoni and Kit Rees; editing by John Stonestreet)

By Danilo Masoni and Kit Rees