European Markets Fall on Fresh Ukraine Worries

Europe's stock markets fell on Thursday after the United States and European Union announced that they would apply further sanctions against Russia over the crisis in Ukraine.

The news sent markets sliding as many investors sought to minimise risky investments amid heightened Ukraine concerns, dealers said.

In midday deals, London's benchmark FTSE 100 fell 0.80 percent to 6,730.46 points, Frankfurt's DAX 30 index shed 1.08 percent to 9,753.03 points and the Paris CAC 40 reversed 1.14 percent to 4,319.1.

Milan stocks dropped 1.47 percent, Madrid decreased by 1.24 percent, and Lisbon was down 1.37 percent. 

European equities had leapt higher on Wednesday owing to strong economic growth data from China.

"Risk aversion has returned to the markets on Thursday after the U.S. and Europe announced a fresh round of sanctions against Russia in response to its part in the Ukrainian conflict," said Alpari analyst Craig Erlam.

"European indices are trading lower across the board and we’re expecting to see a similar response after the opening bell on Wall Street."

Russian stock markets and the ruble fell in the downdraft of the new sanctions moves.

In Lisbon, shares in Banco Espirito Santo which had rallied on Wednesday, fell back sharply on new rating downgrades for the banking group

Asian stocks were mixed after the Dow on Wall Street ticked up another record high in response to strong earnings and a positive outlook on the U.S. economy by the Federal Reserve.

Tokyo finished flat, Sydney was marginally higher and Seoul gained 0.37 percent, while Shanghai lost 0.57 percent and Hong Kong was a shade lower.

The mood remained largely buoyant after China said on Wednesday that the world's number two economy and key driver of global growth expanded more than expected in the second quarter of the year.

U.S. shares resumed their uptrend on Wednesday as traders welcomed a report from the Fed that said all 12 economic regions of the country continued to expand in the six weeks to July 7.

Pointing to generally higher consumer spending, with strong auto sales outperforming other retail segments, the bank's Beige Book report is the latest to indicate the world's top economy is getting back on track.

On Wall Street the Dow jumped 0.45 percent to a new record.

The U.S. market was also cheering better-than-expected earnings from chip giant Intel and a "landmark" IBM partnership with Apple.

In foreign exchange activity on Thursday, the European single currency climbed to $1.3534, from $1.3524 late in New York on Wednesday.

The British pound eased to $1.7115 from $1.7136 on Wednesday. The euro rose to 79.07 pence from 78.92 pence.

In commodity deals, gold decreased to $1,302.75 per ounce from $1,310 on Wednesday.