European Markets Fall After US Fed Disappoints

European markets fell Thursday as investors were disappointed the U.S. Federal Reserve failed to announce any quantitative easing measures on Wednesday.

The German DAX 30 index fell 0.34 percent or 21.58 points to 6370.55. Shares of Daimler AG declined 1.15 percent, and shares of Volkswagen AG fell 1.02 percent.

The French CAC 40 index fell 0.29 percent or 8.98 points to 3117.54. Shares of Peugeot SA declined 2.24 percent, and shares of Credit Agricole SA fell 1.65 percent.

London's FTSE 100 index declined 0.32 percent or 17.95 points to 5604.34. Shares of Xstrata PLC fell 2.01 percent, and shares of Glencore International PLC declined 1.82 percent.

Spain's IBEX 35 fell 1.09 percent or 74.20 points to 6721.90. Shares of Repsol YPF SA declined 4.16 percent, and shares of Telefonica SA fell 1.46 percent.

Market sentiment turned negative as investors learned the Fed would not announce another round of quantitative easing measures. However, the Fed decided to extend its so-called 'Operation Twist' bond-buying program until the end of 2012. Under this stimulus program, the Fed will sell $267 billion of short-term securities and buy the same amount of longer-term debt. This is expected to bring down the cost borrowing in the U.S.

Investors are also focusing on the euro zone PMI flash indices, which are expected to decline slightly in June.

New orders/business components have weakened to worrying levels last month, including in core countries, pointing to further weakness ahead in headlines indices -- or, at least, no imminent clear rebound on the back of declining confidence, ongoing austerity, and a less favorable external environment, Credit Agricole said in a note.

Also read: Asian Stocks Fall On Fed's Moderate Stimulus Measure, Weak China Data