London's FTSE 100 tumbled more than 1% in midday trading to 7,250. Germany's DAX declined 0.3% to 12,872 and France's CAC 40 fell 0.5% to 5,737 after official figures showed that the European economy grew just 0.2% in the quarter from the previous three-month period.
On Wall Street, futures for the Standard & Poor's 500 index and the Dow Jones Industrial Average declined 0.3%. Investors initially welcomed the Fed's Wednesday rate cut to shore up economic growth amid a bruising U.S.-China trade war. On Wednesday, the S&P 500 rose 0.3% to a record.
The Fed has "ample time to add a few more gallons of high octane to the tank and boost a sputtering U.S. economic engine," Stephen Innes of AxiTrader said in a report. With its latest rate cut, the Fed has nearly reversed four hikes made in 2018.
The move reduces the short-term rate the central bank controls — which influences many consumer and business loan rates — to a range between 1.5% and 1.75%. Federal Reserve Chairman Jerome Powell signaled the central bank will likely forgo additional cuts while economic growth and inflation match the Fed's outlook.
On Wednesday, the Commerce Department said U.S. economic growth slowed to a modest 1.9% in the July-September quarter. That surpassed forecasts for even weaker growth, however. Meanwhile, a monthly gauge of Chinese factory activity declined more than expected for October amid weak consumer demand and the tariff war with Washington.
And after the market closed, the Hong Kong government reported the Chinese territory entered its first recession in a decade in the quarter ending in September. Hong Kong's Hang Seng gained 0.9% to 29,906.72 while the Shanghai Composite Index retreated 0.3% at 2,929.06. New Zealand and Singapore advanced, while Taiwan retreated.
China's economy has been hurt by weakening consumer demand as shoppers, jittery over the trade war and possible job losses, put off purchases of cars and other big-ticket goods. Exporters have been hurt by President Donald Trump's tariff hikes on Chinese imports in the fight over Beijing's technology plans and trade surplus.
The two sides are in talks about easing their trade dispute yet a solution still seems far off, with reports on Thursday suggesting Chinese officials are downplaying a longer-term solution to the disagreement.
ENERGY: Benchmark U.S. crude fell 76 cents to $54.30 per barrel in electronic trading on the New York mercantile Exchange. The contract lost 48 cents on Wednesday to close at $55.06. Brent crude, used to price international oils, lost 42 cents to $59.82 per barrel in London. It lost 99 cents the previous session to $60.24.
CURRENCY: The dollar declined to 108.19 yen from Wednesday's 108.64 yen. The euro advanced to $1.1154 from $1.1151.