London (AFP)-European shares fell Thursday after the Federal Reserve has downgraded its growth forecast, while downbeat U.S. manufacturing data raised concern about Chinese economy Asian powerhouse.
The euro fell against the dollar on concerns over the Greek debt crisis.
Around noon, in London, the FTSE 100 to 0.90% benchmark shed 5, 721.18 points. The Frankfurt DAX 30 slid 7% to 1.06, 200.99 points and in Paris the CAC 40 dipped 1.21% at 3, 824.47.
The dollar won support after the Fed, meanwhile, marked the end of its program of buying bonds this month and indicated further credit easing was unlikely. The euro fell to $ 1.4254 in London deals from $ 1.4349 late in New York on Wednesday.
Wall Street sank after the Federal Reserve left in neutral monetary policy on Wednesday and reduced its growth estimates, while the U.S. Fed Chairman Ben Bernanke warned of economic turmoil that may persist for longer than expected.
"The weakness of the financial sector, problems in the housing sector, budgets and low-turbulence-some of these may be stronger or more persistent than we thought," Bernanke said.
Also warned of the potential risks to the global economy from the sovereign debt crisis in Greece.
Federal Open Market Committee (FOMC) has also confirmed that the second round of the Bank's purchase of bonds will end this month as the current problems in the economy were temporary and would not need more stimulus.
Markets had been waiting to see what kind of new policies the Fed might continue after the end of June, when it expects to conclude his $ 600-billion second round of quantitative easing, nicknamed QE2.
"Sobering Words last night by Bernanke confirmed the fears of many in the market-economic recovery remains fragile and there is no further stimulus package coming for the moment," said merchant sales IG Index Yusuf Heusen.
Asian stocks mainly edged down Thursday as traders even poorer Chinese characters pores and cashed after a two-day regional events.
Growth in production of China fell to a low of 11 months of June, preliminary data showed on Thursday, HSBC published as Beijing's efforts to cool the Red-Hot economy has continued to bite.
Preliminary index of purchasing managers HSBC fell to 50.1 in June by a final reading of 51.6 in may, the British banking giant, he said, showing that the sector grew barely as authorities close restrictions on bank loans.
A reading above 50 indicates that the sector is expanding, while a reading below 50 indicates contraction.
"Chinese just expanded in June," said strategist City Index Joshua Raymond.
"A slowdown of growth in China is a growing concern among investors, especially those with displays of raw materials and resource equities.
"Of course, therefore, we have seen a move by investors to switch positions in the field of resources today, with the miners and oil companies most affected," he added.
In the United States, the Federal Reserve has cut its estimate of growth for the economy of the United States this year to a percentage of the 2.7-2 .9, from an earlier forecast of 3.3 -3.1 percent.
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