European shares fell on Wednesday, weighed down by UK healthcare stocks after U.S. suitor AbbVie Inc said it would reconsider its bid for UK pharmaceutical firm Shire.

Shares in Shire fell nearly 30 percent in early deals after AbbVie said it intended to reconsider its recommendation to shareholders to vote in favor of the 32 billion pound ($54.7 billion) merger with Shire Plc due to the changing U.S. tax regulations.

Other UK healthcare stocks such as AstraZeneca, which turned down a Pfizer approach earlier this year, also fell as the chances of a bid from U.S. suitors were seen as diminishing.

Meanwhile, chipmaker CSR saw its shares surge 35 percent after Qualcomm announced it was buying the British company in a $2.5 billion deal.

Shares of Balfour Beatty rose 10 percent after the British infrastructure company revealed that Leo Quinn – formerly of QinetiQ, would be the new chief executive. QinetiQ shares dropped 7.8 percent in early deals.

Asian markets erased early gains to trade mixed midday, as Chinese inflation data slowed more than expected to 1.6 percent in September, adding to concerns over a faltering global economic recovery.

In Germany too, data released on Tuesday showed that German investor morale fell sharply in October, raising fears that the euro zone engine could contract in the third quarter. Euro zone industrial production also declined in August, data showed yesterday. The figure for August fell 1.8 percent from the month before and was worse than expectations in a poll of economists by Reuters.

Overnight, U.S. stocks mostly advanced with the S&P 500 and Nasdaq Composite halting their worst three-day rout since 2011 as investors considered earnings from banking powerhouses JPMorgan Chase, Citigroup and Wells Fargo.

Breaking a three-day string of declines that marked their worst losses since 2011 the S&P500 and Nasdaq ended up slightly yesterday, while Dow Jones finished lower for a fourth session on lingering worries about global demand.

While the S&P closed in positive territory, it was well off its session highs of more than 1 percent and did little to put investors at ease about the market's recent selloff.

The benchmark index has lost 6.6 percent since its Sept. 18 record closing high and is now up just 1.6 percent for the year, while the Dow Jones is down 1.6 percent since Dec. 31.

Asian stocks regained a impression of stability on Wednesday following days of steep losses, but sentiment remained fragile as benign Chinese inflation data and gloom in the euro zone economy added to signs of a faltering global economic recovery.

In a reflection of the cautious mood, markets saw a lower open for Europe, forecasting Britain's FTSE to start as much as 0.2 percent lower, Germany's DAX down 0.17 percent and France's CAX 0.4 percent lower.

The dollar steadied after disappointing data out of Germany and Britain checked the euro's recent bounce.