During European afternoon trade, the EURO STOXX 50 declined 0.72%, France’s CAC 40 slid 0.70%, while Germany’s DAX 30 retreated 0.65%.
Sentiment weakened after official data showed that the unemployment rate in the euro zone rose to a new record high of 12.2% in April, from 12.1% the previous month, in line with expectations.
Separately, a preliminary report showed that the bloc's consumer price index rose to an annualized rate of 1.4% this month, from 1.2% in April, as anticipated.
The data came after Destatis said that German retail sales fell 0.4% in April, disappointing expectations for a 0.2% rise, after a 0.1% decline the previous month.
Financial stocks remained broadly lower, as French lender Societe Generale declined 0.39%, while Germany's Commerzbank and Deutsche Bank plummeted 1.07% and 0.91%.
Peripheral lenders added to losses, with Spanish banks Banco Santander and BBVA slid 0.54% and 0.96% respectively, while Italy's Unicredit and Intesa Sanpaolo retreated 0.69% and 1.10%.
Elsewhere, Roche tumbled 1% after a study in south-east Asia showed the effectiveness of its Tamiflu drug remained unchanged when the dosage was doubled for patients with severe influenza.
In London, FTSE 100 declined 0.91%, even as data showed that net lending to individuals in the U.K. rose by more-than-expected in April.
Financial stocks remained mostly lower, as Lloyds Banking edged down 0.15^ and Barclays slid 0.30%, while HSBC Holdings plummeted 1.54%. The Royal Bank of Scotland overperformed on the other hand, adding 0.29%.
Mining stocks also remained on the downside, as BHP Billiton and Rio Tinto saw shares retreat 0.01% and 0.95% respectively, while Anglo American eased 0.03%.
Separately, coal producer Bumi plunged 1.82% after saying a review of spending at one of its two Indonesian units found USD201 million of outlays with "no clear business purpose." The company is currently at the center of an ownership dispute between its founders.
Adding to losses, TUI Travel dropped 1.05% after saying it plans to buy 60 Boeing 737 MAX aircraft valued at USD6.1 billion and will take options for another 90 planes as the travel company renews its fleet with airliners that are less costly to operate.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.50% loss, S&P 500 futures signaled a 0.50% drop, while the Nasdaq 100 futures indicated a 0.53% decline.
Later in the day, the U.S. was to release revised data on consumer sentiment from the University of Michigan, as well as data on personal income and expenditure and a report on manufacturing activity in Chicago.
