Frankfurt DAX: 4,993.58 (-67.26)

German shares ended a rollercoaster session 1.3 per cent lower as bargain hunters entered the market and briefly brought it back to positive territory from a drop of more than 5 per cent.

Paris CAC-40: 3,708.97 (-36.67)

French shares closed down 0.98 per cent after partially recovering from an earlier fall of more than 4 per cent on a technical rebound.

Stocks that fell included France Telecom, AXA-UAP and Usinor. Risers included Schneider, Bic and Thomson-CSF.

Milan Mibtel: 21,430 (-569)

Italian shares closed 2.59 per cent lower after a volatile session which saw the market swing between losses of 6.4 per cent and 0.5 per cent.

After a morning of heavy selling, the market staged a recovery in afternoon trade but failed to make it into positive territory.