European equity markets nosedived on Friday after data showed that US job growth was much weaker than expected in March, signalling a slowdown in the world's biggest economy.
Amid the gloom, airline stocks were particularly turbulent owing to concerns over the impact of a bird flu outbreak in Asia, dealers said.
At the close, London's FTSE 100 index of leading companies had dropped 1.49 percent to 6,249.78 points and Frankfurt's DAX 30 had slumped 2.03 percent to 7,658.75 points, while in Paris the CAC 40 had lost 1.68 percent to 3,663.48 points.
The US labour market was far weaker than expected in March, with the economy adding only 88,000 jobs, a third of the number in February, according to official data.
Job creation slumped to its softest level since June 2012, and was well below the 192,000 jobs that analysts had expected.
Businesses appeared reluctant to hire in the face of sluggish growth and after the federal government's $85 billion a month "sequester" spending cuts kicked in on March 1.
"The weak March is particularly discouraging given the inevitable impact on the economy from the sequester," said Sophia Koropeckyj of Moody's Analytics.
"However, the recovery is on much better footing this year than in the last few springs and the recovery in the housing market will do much to support growth," she said.
Back in Europe, airline stocks dived on rising fears over the impact of a news strain of bird flu that has already killed six people in China.
Air-France KLM shares were down 7.43 percent to 6.77 euros on the Paris stock exchange, while Lufthansa was off 5.23 percent to 14.14 euros in Frankfurt.
In London, shares in IAG, which owns British Airways and Iberia, fell 6.90 percent to 234.9 pence, while low-cost carrier easyJet's share price showed a loss of 6.38 percent at 1,027.00 pence.
"Concerns over bird flu could be a catalyst for these drops," said a Paris trader.
The sector was also hit after easyJet forecast that it would halve its first-half pre-tax losses, but would remain in the red due the adverse impact of currency movements and changes in fuel prices.
The low-cost carrier said in a trading update that pre-tax losses would stand at between £60 million and 65 million ($91-99 million, 71-77 million euros) for the six months to March 31.
"Brokers have taken a mixed view of the numbers, which saw the budget carrier trim first half losses significantly, but voice concerns over the general state of the economy and its likely impact on demand in 2013," added Basi.
In foreign exchange activity on Friday, the euro shot up to $1.2997 from $1.2934 late in New York on Thursday and even briefly hit above the $1.30 mark.
On the London Bullion Market, gold prices rose to $1,552.75 per ounce from $1,546.50.
In earlier deals on Friday, Hong Kong dived 2.73 percent after bird flu deaths were reported in mainland China, which rekindled memories of the SARS outbreak in 2003.
Most Asian markets also fell, but Tokyo enjoyed a second straight rally and the yen fell after the Bank of Japan (BoJ) unveiled a vast plan to boost the economy.
The Nikkei index surged more than four percent in early trade to its highest level since August 2008, a day after the BoJ's stimulus aimed at bringing years of deflation to an end.
But profit-taking later in the day meant the rally dimmed, while the yen regained slightly after suffering a big sell-off in the wake of the bank announcement.
The Nikkei won 1.58 percent to close at 12,833.63 points, which was its best close since September 1, 2008, weeks before the global financial crisis rocked markets.
Other regional Asian markets struggled as jitters set in over the US economy and tensions on the Korean peninsula.