European shares today marked their worst quarter since the pandemic-led selling of early 2020, as investors became increasingly wary of a global recession given hawkish central bank actions to try to tame inflation.

All the major sectors were in the red. Banks weighed the most, with a gauge of euro zone lenders sliding 3.3% to March lows after the ECB's top supervisor asked lenders to calculate recession risks.

The continent-wide STOXX 600 index dropped 1.5%, chalking up quarterly losses of 10.7%. Miners were among the biggest drags in the quarter, down more than 20%.

With euro zone inflation at record highs, data on Thursday showed France's inflation in June climbed further from the previous month to a record 6.5%, and weighed on the local stock index which slid 1.8%.

"What we're seeing at the moment is more evidence that inflation is serious, entrenched and investors are having to now reappraise the valuations they are putting on equities," said Azad Zangana-, senior European economist and strategist at Schroders.

"The attitude in Europe was that a lot of the inflation is external. That's changing now and over the next few months, the European Central Bank will have to step up its efforts to curb inflation."

UBS trimmed its 2022 economic growth forecast for the euro zone and said the region is heading towards "stagflation" as efforts to stamp out inflation will bring growth to a near halt in the second half of the year.

All eyes are on the first estimate of June inflation for the euro zone due on Friday, which the ECB should scrutinise ahead of its July 21 policy meeting when it has said it will hike rates for the first time since 2011.

The STOXX 600 has shed more than 16% this year so far, as worries from soaring inflation to China's slowing economy and Russia's invasion of Ukraine curb risk appetite.

Among single stocks, Uniper tumbled 14.4% after the German utility withdrew its outlook for the 2022 financial year due to gas supply restrictions from Gazprom.

Shares of its Finnish parent Fortum dropped 6.1%.

Electrode maker Industrie De Nora slipped 4.4% on its debut on Italy's main market.

BioNTech rose 5.6% after the German drugmaker along with Pfizer signed a $3.2 billion deal with the US government for the delivery of 105 million doses of their Covid-19 vaccine.