European shares closed sharply lower on Thursday afternoon, as the head of the Bank of England warned that the time for raising interest rates from record lows was nearing.
The pan-European FTSEurofirst 300 closed provisionally down 1 percent at 1,372.42 points, as Bank of England Governor Mark Carney told a conference of actuaries that the improving economy meant a rate rise was to be expected.
European stocks had also been pressured by a fall on Wall Street, after disappointing U.S. economic data.
European markets
The German DAX was a notable weak performer, closing down around 1.5 percent, below its 200-day moving average level of 9572.98. Traders attributed this to media reports that Russia had drafted a law to allow the seizure of foreign assets—a long-held fear of investors. Germany's trade links with Russia mean the DAX has proved particular vulnerable among European bourses to updates on its deteriorating relationship with the West.
The Italy's FTSE MIB also underperformed, closing down around 1.4 percent. Earlier this week, Italy seized about 30 million euros ($38 million) worth of assets from a key ally of Russian President Vladimir Putin.
On Thursday, shares of Italian cement maker Buzzi Unicem were halted after they tanked more than 4 percent. Traders said this was due to its high exposure to Russia, and legal developments surrounding asset seizures.
Words from European Central Bank Governor Mario Draghi were also in focus on Thursday. He told Lithuanian business daily Verslo Zinios that the central bank was ready to instigate more monetary stimulus measures if necessary.
"We stand ready to use additional unconventional instruments within our mandate, and alter the size or composition of our unconventional interventions should it become necessary to further address risks of a too prolonged period of low inflation," Draghi said, according to Reuters.
H&M shares fall
Retailer H&M announced results for the third quarter that showed sales slowed in September. Shares in the company closed lower down around 4.3 percent.
FTSE 100-listed Hargreaves Lansdown closed down around 4.2 percent after a price target downgrade by RBC.
Airbus shares closed up around 1.7 percent after the company raised its long-term demand forecast for the aircraft market. It cited demand in Asia and increased fuel efficiency.
Shares of Dutch company PostNL closed up by roughly 1.2 percent after an upgrade to "neutral" from Citigroup.
Follow us on Twitter: @CNBCWorld