Investing.com - European stocks were lower on Thursday, tracking the previous session's fall in U.S. markets after Federal Reserve Chair Janet Yellen said that equity valuations remain high and as markets were jittery ahead of the U.K. general election.
During European morning trade, the EURO STOXX 50 dropped 0.90%, France’s CAC 40 declined 0.83%, while Germany’s DAX 30 slid 0.39%.
Speaking at the International Monetary Fund's "Finance and Society" conference on Wednesday, Yellen said high equity valuations could pose potential dangers but that stability risks across the U.S. financial system remained in check.
Yellen added however that she did not see any bubbles forming at the moment and described risks to financial stability as "moderated, not elevated."
Investors also remained wary ahead of Thursday's U.K. elections which were widely expected to result in a hung parliament and an unstable coalition government.
Elsewhere, official data earlier showed that German factory orders rose 0.9% in March, disappointing expectations for an increase of 1.5%, after a 0.9% fall the previous month.
Financial stocks were broadly lower, as French lenders BNP Paribas (PARIS:BNPP) and Societe Generale (PARIS:SOGN) tumbled 1.41% and 2.37%, while Germany's Commerzbank (XETRA:CBKG) and Deutsche Bank (XETRA:DBKGn) fell 0.10% and 0.54%.
Among peripheral lenders, Italy's Intesa Sanpaolo (MILAN:ISP) and Unicredit (MILAN:CRDI) declined 0.47% and 0.75% respectively, while Spanish banks BBVA (MADRID:BBVA) and Banco Santander (MADRID:SAN) lost 0.47% and 1.30%.
Adding to losses, Siemens AG (XETRA:SIEGn) plummeted 2.20% the German engineering company reported profit below analysts' expectations and announced plans to cut another 4,500 jobs.
ArcelorMittal (AMS:ISPA) saw shares dive 2.59% as the steel manufacturer cut its full-year profit target after iron ore's drop to a decade-low.
In London, the commodity-heavy FTSE 100 retreated 0.85%, weighed by sharp losses in mining stocks.
Shares in Rio Tinto (LONDON:RIO) declined 1.10% and Bhp Billiton (LONDON:BLT) tumbled 1.35%, while Glencore Xstrata (LONDON:GLEN) plummeted 1.46%.
Financial stocks were also mostly lower, as the Royal Bank of Scotland (LONDON:RBS) slid 0.36% and Lloyds Banking (LONDON:LLOY) dropped 0.49%, while Barclays (LONDON:BARC) lost 1.06%. HSBC Holdings (LONDON:HSBA) overperformed however, with shares edging up 0.15%.
Meanwhile, Glaxosmithkline (LONDON:GSK) plunged 1.90% after the pharmaceutical company said it now plans to return less money to shareholders, in part due to "uncertainties, including the possible introduction of generic Advair in the U.S.," which would compete with its top-selling lung drug.
In the U.S., equity markets pointed to a lower open. The Dow Jones Industrial Average futures pointed to a 0.12% slip, S&P 500 futures signaled a 0.13% fall, while the Nasdaq 100 futures indicated a 0.16% loss.
Later in the day, the U.S. was to publish the weekly report on initial jobless claims.