ECB sees economy recovering at subdued pace

The ECB held its main refinancing rate unchanged at 0.5 percent after its monetary policy meeting on Thursday.

ECB President Mario Draghi told a news conference after the meeting that “economic activity should stabilize and recover in the course of the year, albeit at a subdued pace”.

The ECB's growth forecast for the euro area this year was lowered to minus 0.6 percent from a previous estimate of minus 0.5 percent but the projection for next year was raised to 1.1 percent from 1 percent.

Also on Thursday, the Bank of England kept its bond-purchase target at 375 billion pounds and maintained its key rate at 0.5 percent.

In a sign that Europe's economy remains weak, a report on Thursday showed that German factory orders fell 2.3 percent in April, reversing the 2.3 percent increase in March.

European stocks fell on Thursday. The STOXX Europe 600 declined 1.2 percent, reversing early gains after the ECB failed to signal additional monetary stimulus for the near future.

However, US stocks managed to finish up on Thursday. The S&P 500 rose 0.9 percent to end a two-day losing streak.