Jonathan Sudaria, a dealer at Capital Spreads, cited tentative bargain hunting. "But as yesterday's sudden sell-off showed, it doesn't take much to bring out the bears in this current environment," he said in a note.
Surprisingly weak economic data from China and the United States recently and the International Monetary Fund's decision to trim its global growth forecast have undermined confidence in the outlook for the world economy this year.
However, some analysts say the market move is more a timely correction after strong gains in the first quarter of the year, when optimism over the U.S. economy lifted Wall Street stocks to record peaks and boosted European shares to multi-year highs.
U.S. stock futures were little changed, suggesting a calm Wall Street open after both the Standard & Poor's 500 Index .SPX and the Nasdaq Composite Index .IXIC closed down more than 1 percent on Wednesday. .N
Japan's Nikkei average .N225 declined 0.9 percent and MSCI's index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.7 percent, leaving the MSCI world equity index .MIWD00000PUS down 0.2 percent.
COMMODITIES SINK
The prospect of lower growth, especially in China, has continued to weigh on the commodity markets where copper and oil are near multi-month lows and gold is close to its weakest level for two years.
U.S. gold futures, which sometimes dictate spot gold prices, were at $1,377.40 an ounce, down about 0.4 percent, as holdings in the world's top gold-backed exchange-traded fund hit a three-year low.
Spot gold hit $1,339.86 an ounce, near Tuesday's two-year trough of $1,321.35 and is down about a quarter from last year's peak after shedding 18 percent so far this year.
However, the lower gold price was also expected to encourage demand from investors who want to hold the physical product rather than securities representing the metal.
"Investors, who value physical gold over paper gold, have viewed these low prices as a buying opportunity," said Edmund Moy, chief strategist at gold provider Morgan Gold, adding that sales of new gold coins from the U.S. Mint had jumped in April.
Copper, seen as a gauge for manufacturing and China-related growth, broke below $7,000 a ton for the first time since late 2011, with London copper futures sliding as much as 4 percent to $6,800 a ton.
Brent crude oil steadied after touching its lowest levels since last July, but remains well below the $100 per barrel mark while U.S. crude fell 0.2 percent to $86.55, after dipping under $86 earlier to a fresh four-month low.
"We're just seeing an ongoing adjustment to the weaker data seen earlier in the week ... What we're (also) seeing is a price adjustment to an emerging outlook that supply is increasing," said Ric Spooner, chief market analyst at CMC Markets.
In the debt market German Bund futures were steady, supported by expectations of loose central bank monetary policy, with the focus on Spanish and French debt auctions later in the day.
The Bund future was flat at 146.20, close to a high of 146.54 set at the start of the month. Demand was boosted on Wednesday by comments from European Central Bank policymaker Jens Weidmann, who stoked belief that interest rates could fall if economic data remains weak.
