European shares were down, set to fall for a third consecutive session, as banking stocks weighed, while food producers also fell after Danone cut its sales growth target.
By 1101 GMT, the pan-European FTSEurofirst 300 index was down 0.3 percent at 1,024.29 points. The index, which is up 23 percent in 2009, has surged 59 percent since reaching a record low in early March.
Banks took most points off the index, with HSBC, Credit Suisse, Deutsche Bank and UBS down 0.5 to 0.9 percent.
"Sensibility is returning to the market. It's no longer about looking for the positive side of the news, but rather taking a step back and being a bit more critical," said Heinz-Gerd Sonnenschein, equity strategist at Postbank.
"The sentiment is not remarkably positive today, also due to slight losses on Wall Street yesterday."
Food producers also weighed. Danone fell 4.9 percent after the company said it expected medium-term like-for-like annual sales growth of at least 5 percent, compared with a previous forecast of 8 to 10 percent.
Across Europe, the FTSE 100 index was down 0.1 percent, Germany's DAX was 0.3 percent lower and France's CAC 40 was down 0.5 percent.
Miners were the top sectoral decliner on lower metal prices. Anglo American, Antofagasta, BHP Billiton, Rio Tinto and Xstrata fell 1.3 to 4.1 percent.
Japan's benchmark Nikkei share average fell 1.3 percent to a four-month closing low, with the nation's biggest bank Mitsubishi UFJ Financial Group sliding after announcing a massive fundraising.
MUFG fell 3.7 percent to 466 yen after saying on Wednesday it would raise US$11 billion to meet stricter capital rules, the latest in a wave of fundraising that has seen Japanese companies already raise $40 billion through issuing common stock and convertible bonds this year.
Shares fell in heavy volume, and exporters took a hit as the yen rose against the dollar and other currencies, with Honda Motor Co falling 3.5 percent to 2,740 yen.
"With the capital raisings, the yen's strength and politics, there is three times the pain," said Tomomi Yamashita, a fund manager at Shinkin Asset Management.
Concerns about the fiscal and economic policies of the new Democratic Party-led government have weighed on Tokyo shares in the past few months.
The benchmark Nikkei fell 127.33 points to 9,549.47 .N225, its lowest close in four months.
The Nikkei fell earlier to a four-month intraday low of 9,496.07, edging down towards support at the 200-day moving average that now lies at 9,337.29.
The broader Topix index, which broke below its 200-day moving average last week, slid 1.5 percent to 837.71, its lowest closing level in nearly seven months.
Trading volume surged, with 2.6 billion shares changing hands on the Tokyo exchange's first section, compared to last week's daily average of 1.7 billion. Masayoshi Okamoto, head of dealing at Jujiya Securities, said part of the selling pressure likely came from retail investors hit with margin calls and forced to liquidate long positions.
Some in the market said the Nikkei may be oversold and that could set the stage for a rebound.
