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London - Europe's main stock markets fell on Wednesday when caution prevailed on the eve of interest rate decisions in Britain and the eurozone, dealers said.
Investors were on edge also ahead of this week's key non-farm payrolls data in the United States, which is the world's biggest economy.
London's FTSE 100 index of top companies slid 0.22% to 6 821.52 points in midday trade, hit additionally by poor quarterly earnings from Britain's biggest retailer Tesco.
Frankfurt's DAX 30 index shed 0.14% to 9 907.14 points and the Paris CAC 40 index fell 0.08% to 4 500.27, compared with Tuesday's closing level.
"European equities have drifted lower ... as traders continue to pass time until this week's big economic releases," said Capital Spreads dealer Jonathan Sudaria.
"With no one in a rush to do anything, markets are still hovering near their recent highs but with no one willing to bet big ahead of the central bank meetings and payrolls."
In London, Tesco saw its share price slide 0.59% to 295.75 pence after indications that the supermarket group had suffered its largest quarterly drop in domestic sales for four decades.
British sales excluding petrol in stores open at least a year sank 3.7% in its first quarter, or the three months to May, from a year earlier. That was the third successive quarterly drop.
Tesco, the world's third-biggest supermarket group, faces competition from German-owned discounters Aldi and Lidl, as well as from traditional supermarket rivals comprising Wal-Mart division Asda, Sainsbury's, William Morrison and Waitrose.
Asian equities mostly fell on Wednesday after two days of healthy gains, while investors also took their lead from Wall Street's retreat from record highs.
Global markets had started the week on the front foot in response to a marked improvement in manufacturing activity in China and the United States.
However, dealers took their cash off the table on Tuesday ahead of interest rate decisions from both the Bank of England and the European Central Bank (ECB) on Thursday.
European equities also slid on Tuesday but losses were capped as weaker-than-expected eurozone inflation data cemented expectations that the ECB would implement monetary easing later this week, dealers said.
In foreign exchange deals on Wednesday, the euro dipped to $1.3608, down from $1.3627 late in New York on Tuesday.
The European single currency firmed to 81.39 British pence from 81.36p.
The British pound decreased to $1.6721 from $1.6750 on Tuesday.
The price of gold rose to $1 246.26 an ounce from $1 242.75 Tuesday on the London Bullion Market.
In Asia, the Tokyo stock market added 0.22% on Wednesday, with sentiment supported by the weaker yen which boosts exporters.
On the downside, Hong Kong dropped 0.60%, Shanghai shed 0.66% and Sydney fell 0.64%. Seoul was closed for a public holiday.
Wall Street stocks on Tuesday retreated from the previous day's records, as traders eyed the payrolls report.
The Dow Jones Industrial Average dropped 0.13% to 16 722.34 points, while the S&P 500 slipped 0.04% to 1 924.24 points. Both indices closed at record peaks on Monday.
