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They said a constant flow of bad news about the impact of the crisis in the US subprime or higher risk mortgage market kept prices under pressure despite a positive showing in Asian trade.
Stocks there had got a boost from a positive report on US consumer spending over the US Thanksgiving holiday last week which bolstered hopes the US economy would avoid recession but that lead faded quickly in Europe on Monday.
London's FTSE 100 index closed down 1.
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30 percent at 6,180.50 points, with CAC 40 in Paris off 1.
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14 percent to 5,458.39 points while in Frankfurt the Dax fell 0.
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55 percent to 7,567.36 points.
The markets had been ahead in early trade after sharp gains in Asia where Japan's Nikkei-225 index gained 1.
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66 percent to close at 15,135.21 points while in Hong Kong the Hang Seng index jumped 4.
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09 percent to 27,626.62 points.
The euro was at 1.4860 dollars in late European deals.
The Euro Stoxx 50 index shed 0.
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70 percent to 4,238.00 points.
In early New York deals, US stocks l