The European markets fell for the first time in four days on Wednesday, as UBS led banking stocks lower after reporting a loss for the first quarter and Rio Tinto paced declines among miners after reporting a 15% drop iron-ore output.

The benchmarks extended their declines after the U.S. Federal Reserve said in its report that industrial production fell by 1.5% in March, matching the decrease that was reported for the previous month. Economists had been expecting a somewhat more modest decrease of about 0.9%.

The U.S. Labor Department said its consumer price index edged down 0.1% in March following a 0.4% increase in February. The modest decrease came as a somewhat of a surprise to economists, who had expected prices to edge up 0.1%. Excluding food and energy prices, the core consumer price index rose 0.2% for the third consecutive month. Economists had been expecting a 0.1% increase in core prices.

Crude oil prices continued to hover around $50 a barrel. Crude for May delivery traded down $0.09 at $49.32 a barrel on the New York Mercantile Exchange, by the time the European markets closed.

The FTSEurofirst 300 index of pan-European blue chips closed 0.22% lower at 788.21 points, while the narrower DJ Stoxx 50 index fell 0.29% to 1,937.75 points.

Around Europe, the U.K.'s FTSE 100 index dropped 0.52% to 3,968.40, while France's CAC 40 index slipped 0.48% to 2,985.74 and Germany's DAX index fell 0.16% to 4,549.79.

UBS, Switzerland's largest bank, slipped 6.9% after the company reported a first quarter loss of nearly 2 billion Swiss francs and said it will reduce its workforce by another 11%.

BNP Paribas, France's largest bank, fell 1.5%, while Deutsche Bank, Germany's largest, dropped 4.3% and Banco Santander, Spain's biggest lender, slipped 2.9%. Credit Agricole, France's third largest bank, declined 2.7% and Asia-focused bank Standard Chartered lost 2.6%.

Miners lost ground after Rio Tinto, the world's third biggest miner, said its first quarter iron-ore output dropped 15%. Rio shares dived 5.2%. BHP Billiton, the world's biggest miner, slipped 3.9%, while Anglo American, the second biggest, fell 3.1% and copper miner Antofagasta lost 6.3%.

On the other hand, traditionally defensive stocks that are less reliant on economic growth rallied. GlaxoSmithKline, Britain's biggest drugmaker, rose 1.6%, while British American Tobacco climbed 4.8% and Imperial Tobacco surged up 3.6%.

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