Investor fears on Monday were centered around the financial sector. Deutsche Bank bore the brunt of the selling with market watchers detailing concerns over its exposure to the energy sector and a possible cash crunch.
U.S. banks have been busy recapitalizing after the 2008 crisis but their European counterparts have been slow off the mark. Deutsche Bank has come out fighting saying it has "sufficient" reserves to service its so-called tier 1 debts.
But this was only after a near 10 percent fall in its share price on Monday and a hefty rise in the price of its 5-year credit default swaps - the price it costs to insure its debt over a 5-year period.
"The cost of insuring against Deutsche Bank defaulting has gone up two and a half times so far in 2016. That's back to levels not seen since the height of the euro zone crisis in 2011," Financial analyst Louise Cooper, founder of CooperCity, said in a morning note.