European shares sank to their lowest levels in more than five years as fears over the extent of a global recession fuelled the continuing sell-off in financials and commodities.

The benchmark pan-European FTSE Eurofirst 300 fell 3.8 per cent to 781.06 – its lowest level since April 2003. Germany’s Xetra Dax lost 3.1 per cent to 4,220.20 and in France, the CAC 40 lost 3.5 per cent to 2,980.42.