The European Central Bank announced fresh stimulus measures after its monetary policy meeting on Thursday.
The latest measures included cuts to all three of the ECB’s main interest rates, €20 billion a month of additional bond purchases and an expansion of its quantitative easing programme to highly rated corporate bonds.
The STOXX Europe 600 initially rose 2.5 percent on Thursday but closed down 1.7 percent. The S&P 500 rose less than 0.1 percent.
Earlier on Thursday, Asian markets had been mixed. The Nikkei 225 rose 1.3 percent but the Shanghai Composite Index fell 2 percent.
The market reaction to the ECB move on Thursday led many analysts to conclude that the power of central banks to influence markets and the economy may be on the wane.
“We are reaching the limits of monetary policy, and that is causing markets a headache,” said Mark Dowding, senior portfolio manager at BlueBay Asset Management.
However, other analysts remain confident of central banks' power.
Bill Street, head of investment for Europe Middle East and Africa at State Street Global Advisors, said that “this is all going to be positive momentum from where we were, for both economy and also risky assets”.