The headline index, which remained above the 50-mark that is consistent with expansion, is based on surveys of thousands of companies and viewed by analysts as a good gauge of growth.
"Disappointing overall but not disastrous," said Howard Archer, chief European economist at IHS Global Insight, in a note. "Euro zone manufacturing and services expansion unexpectedly moderated in April according to the purchasing managers, perhaps providing a reality check on the strength of the region's upturn."
Archer added that it remains to be seen whether the slowdown in business growth was mostly a correction after four months of improvement, or a sign that a pick-up in euro zone economic activity was levelling off.
Earlier on Thursday, Markit's German flash composite PMI fell to 54.2 in April from an eight-month peak of 55.4 in March. France's composite PMI, meanwhile, fell to 50.2 from 51.5 in March.
"We also had the reading from France and the French manufacturing and services PMI data has done what it does the best - disappoint investors to their core," said Naseem Aslam, chief market analyst at AvaTrade, in a note.
Indeed, the tone of the PMI data helped weigh down European shares, with the pan-European STOXX 600 index down 0.8 percent in early trade.
Also undermining sentiment was news earlier in the day that the flash HSBC China PMI for April fell to a one-year low of 49.2 in April from 49.6 last month, remaining in contraction territory. U.S. PMI data is due out later in the day.
Read MoreChina's factory activity falls to one-year low