Stock indices traded lower on geopolitical tensions and on concerns over the slowdown in the Chinese economy. The Caixin/Markit Services Purchasing Managers' Index (PMI) for China declined to 50.2 in December from 51.2 in November, missing expectations for an increase to 52.3.
North Korea announced on Wednesday morning that it successfully tested hydrogen nuclear bomb. The announcement followed detection of a 5.1 magnitude earthquake. It would be the fourth nuclear test since 2006.
Meanwhile, the economic data from Eurozone was mixed. Markit Economics released final services purchasing managers' index (PMI) for the Eurozone on Wednesday. Eurozone's final services purchasing managers' index (PMI) remained unchanged at 54.2 in December, up from the preliminary reading of 53.9.
The index was driven by a rise in business activity in Germany, Italy, Spain and Ireland.
Eurozone's final composite output index rose to 54.3 in December from 54.2 in November, up from the preliminary reading of 54.0.
"The Eurozone economy starts 2016 on a solid footing and well placed to enjoy a year of robust expansion. Growth of business activity continued to edge higher at the end of 2015, with an upturn in the PMI rounding off the strongest quarter for four and-a-half years," Chief Economist at Markit Chris Williamson said.
He added that the Eurozone's economy grew at 0.4% in the fourth quarter and 1.5% in 2015.
Germany's final services purchasing managers' index (PMI) rose to 56.0 in December from 55.6 in November, up from the preliminary reading of 55.4. It was the highest level since July 2014.
France's final services purchasing managers' index (PMI) dropped to 49.8 in December from 51.0 in November, down from the preliminary reading of 50.0.
Eurostat released its producer price index for the Eurozone on Wednesday. Eurozone's producer price index declined 0.2% in November, in line with expectations, after a 0.3% decrease in October.
On a yearly basis, Eurozone's producer price index dropped 3.2% in November, missing expectations for a 3.1% decrease, after a 3.2% fall in October. October's figure was revised down from a 3.1% drop.
Eurozone's producer prices excluding energy fell 0.7% year-on-year in November.
Markit's and the Chartered Institute of Purchasing & Supply's services purchasing managers' index (PMI) for the U.K. declined to 55.5 in December from 55.9 in November, missing expectations for a fall to 55.6.
A reading above 50 indicates expansion in the sector.
The decline was driven by a slower growth in new business and job creation.
"The services sector remained the key driver of the UK's economic upturn in December, helping to offset the recent weakness seen in manufacturing and putting the economy on the starting block for another year of 2-2.5% growth in 2016," the Chief Economist at Markit Chris Williamson said.
He added that the U.K. economy expanded 0.5% in the fourth quarter of 2015.
Indexes on the close:
Name Price Change Change %
FTSE 100 6,073.38 -63.86 -1.04 %
DAX 10,214.02 -96.08 -0.93 %
CAC 40 4,480.47 -57.16 -1.26 %