RTTNews - The European markets fell for the first time in four days on Thursday, as concerns about mounting government debt and disappointing U.S. home sales data diminished hope that the global recession is easing.

The U.S. Commerce Department said in its report that new homes sales edged up 0.3% to an annual rate of 352,000 in April from a revised 351,000 in March. Economists had expected sales to rise to 360,000 from the 356,000 originally reported for the previous month.

Separately, the U.S. Commerce Department said that durable goods orders jumped 1.9% in April following a downwardly revised 2.1% decrease in March. Economists had expected orders to edge up 0.5% compared to the 0.8% drop that had been reported for the previous month.

Crude for July delivery rose $1.28 to $64.73 a barrel on the New York Mercantile Exchange, by the time the European markets closed, as government reports showed that U.S. consumers are spending money and number of Americans filing first-time unemployment claims edged down again last week.

The FTSEurofirst 300 index of pan-European blue chips closed 1.20% lower at 860.21 points, while the narrower DJ Stoxx 50 index fell 0.97% to 2,117.79 points.

Around Europe, the U.K.'s FTSE 100 index fell 0.655 to 4,387.54, while France's CA 40 index slipped 0.95% to 3,263.70 and Germany's DAX index dropped 1.36% to 4,932.88.

Banking stocks were among the worst losers. Deutsche Bank, Germany's largest bank, slipped 3.7%, while Royal Bank of Scotland, Britain's second largest bank, dropped 4.6% and Barclays, Britain's third largest, fell 1%. Swiss bank Credit Suisse lost 2%.

Wolseley, the world's biggest supplier of heating and plumbing equipments, tumbled 18% after the company reported a 80% drop in nine-month profit and warned that markets won't recover this year.

Man Group, the world's largest publicly traded hedge fund manager, slid 6.9% after the company said its annual pretax profit dropped 43% after assets under management declined.

Infineon, Europe's second biggest chipmaker, dropped 7.1% after the Financial Times Deutschland said Infineon has asked the government for ?500 million of loan guarantees.

On the other hand, heavily weighted oil stocks edged higher after crude oil prices advanced. BP, Europe's biggest oil company, rose 0.6% and Royal/Dutch Shell, the second biggest, surged up 1%.

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