- Eurozone private sector loans fall
- France consumer confidence rises
- UK economy grows in Q2, GDP figures show
- US GDP, jobless claims and home sales
FTSE 100: -0.20%
CAC 40: -0.53%
FTSE MIB: -1.75%
IBEX 35: -0.33%
Stoxx 600: -0.28%
European equities moved into the red as a report on Eurozone loans indicated that the currency bloc's recovery still has a long way to go.
Private sector loans in the Eurozone fell by 2% in August compared to a year earlier, signalling that small companies and households are still struggling to benefit from the European Central Bank's (ECB) monetary easing.
The report revealed non-financial corporations are struggling to get their hands on financing despite progress in bank funding.
Other data released by the central bank on Thursday showed that the rate of growth in the M3 money supply rose to 2.3% in August from 2.2% in July, in line with economists´ forecasts. However, M3 supply is down to 2.3% for the past three months compared to 2.5% in the same period a year earlier.
The data points to an ongoing credit crunch in which companies and households are having a tough time trying to secure funding.
It also shows that one of the ECB's key problems is still not fixed despite providing what some consider is sufficient liquidity to banks.
ECB President Mario Draghi has discussed the possibility of new long-term refinancing operations, but it remains to be seen whether the extra liquidity will boost economic recovery.
Also weighing on markets on Thursday was the release of Italy's retail sales which fell by a seasonally adjusted 0.3% in July compared to 0.2% in June.
On a brighter note, France's consumer confidence rebounded in September to reach a seven-month high.
INSEE's indicator for consumer sentiment rose from 84 last month to 85 this month, in line with the consensus estimate.
UK and US GDP figures
The UK economy grew in line with market expectations in the second quarter, according to the Office for National Statistics.
Gross domestic product (GDP) rose by 0.7% when compared to the previous three months, during which it increased at the same quarterly rate.
US GDP will be released later on Thursday and is forecast to rise to an annualised 2.6% in the second quarter from 2.5% in the prior three months.
Another US report will show initial jobless claims increased to 325,000 in the week ended September 20th, from 309,000 a week earlier, economists predict.
US pending home sales rose 6.3% year-on-year in August compared to 8.6% in July, consensus revealed ahead of the report's unveiling.
The data comes as the Federal Reserve weighs when to begin scaling back stimulus and as the US government debates the debt ceiling.
Fed officials Jeremy Stein, Narayana Kocherlakota and Sandra Pianalto will speak in the US on Thursday, which might provide more indication as to where the central bank is headed in its plans for quantitative easing.
Meanwhile, Treasury Secretary Jacob Lew said on Wednesday the US will hit its debt ceiling by October 17th, leaving the government with $30bn of cash - half the money it needs to pay its bills.
"Clearly investors hate the uncertainty surrounding these talks," said Alpari Market Analyst, Craig Erlam.
"Investors are currently concerned about the possibility of a partial government shutdown if no budget for the next year is passed by next week, followed by a default on US debt in the middle of the month, should the debt ceiling not be raised."
Ladbrokes slumps on profit warning
Ladbrokes tumbled after issuing a profit warning for its digital division due to lack of competitiveness and lower-than-planned margins.
Interdealer broker ICAP declined after agreeing to pay £55m to UK and US regulators as part of the long-running scandal over the alleged manipulation of the London Interbank Offered Rate (LIBOR) by three former employees between 2006 and 2011.
Thomas Cook plunged after the tour operator said summer bookings broadly flat and the winter had a slow start.
H&M rallied after reporting a 22% rise in third quarter profit to 4.43bn kroner, beating analysts' expectations.
Vinci advanced following reports the European builder could sell all or part of its parking unit.
Brent crude edges higher
Brent crude futures rose $0.295 to $108.640 per barrel on the ICE.
The euro fell 0.14% to the 1.3507 US dollar.