Global stocks fell again Friday as fears of a possible US recession combined with ongoing worries over Europe's debt crisis, which is stoking acute fears over the continent's banking sector.
However, smaller than anticipated losses on Wall Street helped European markets recoup a large chunk of their earlier losses by the close.
In Europe, Britain's FTSE 100 closed down 1 per cent at 5,040.76 while Germany's DAX fell 2.2 per cent to 5,480. France's CAC-40 ended down 1.9 per cent at 3,016.99.
In the US, the Dow Jones industrial average was down 0.4 per cent at 10,944 while the broader Standard & Poor's 500 index fell 0.2 per cent at 1,138. Futures markets had been predicting far bigger declines earlier.