European shares closed lower on Wednesday, shadowing losses on U.S. bourses, following reports that showed private employers added less jobs than expected in March and the U.S. services sector showed the weakest growth in seven months.
U.S. private employers added 158,000 jobs in March, falling short of economists' expectations for a gain of 200,000, according to payrolls processor ADP. Meanwhile, the Institute for Supply Management said its services index fell to 54.4 last month from 56 in February, also missing economists' forecasts.
In Europe, the FTSEurofirst 300 Index closed provisionally down 0.8 percent at 1,194.09 points as Italy's political impasse continued to shake markets, and telecom giant Vodafone posted hefty declines after a potential buyer denied takeover rumors.
Another day of meetings between Italian President Giorgio Napolitano and his team of "wise men" took place on Wednesday, as they work on establishing reform measures that can achieve broad political support. Milan's FTSE MIB closed 2.3 percent lower, posting the biggest declines among the key European country indexes.
Portugal's PSI 20 benchmark index also closed lower on Wednesday, ahead of a confidence vote in Prime Minister Pedro Passos Coelho. This is Portuguese politicians' fourth attempt to oust their current leader. A no confidence vote could jeopardize progress with austerity measures, as the constitutional court is expected to rule on forthcoming public spending cuts within the next few days.
In company news, Verizon Communications talked down speculation that it is interested in buying or merging with Vodafone. The denial follows media speculation that it was working with rival AT&T on a breakup bid for the British heavyweight. Vodafone stock fell 3.13 percent and weighed on the FTSE 100 Index, which closed unofficially 1 percent lower.
Aerospace firm EADS announced late on Tuesday it was adopting a 3.75 billion euro buyback scheme; shares sank by 2.87 percent on Wednesday.
Basic resources was the worst performing sector, after telecoms, on Wednesday, with miners tracking a downward move in metal prices, and hit by demand concerns after weak manufacturing data from China, the U.S. and Europe.