European shares hit the buffers on Friday as technical resistance around the 1,156 level helped stall momentum. Trade was subdued, as investors avoided making large bets at the end of a volatile quarter.
Healthcare, technology and banking stocks led the FTSEurofirst 300 down 5.30 points, or 0.5 percent to 1,152.12 by 1027 GMT after hitting technical resistance at around 1,156 points - its 200-day moving average.
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European shares hit seven-month lows on Monday and are set for their first monthly and quarterly losses in a year, hurt by worries over the global economy as central banks ease stimulus.
"It is unlikely that equities will repeat the performance of the last 12 months (when European equities rose around 30) with economic growth subdued and loan growth lagging," said Mark Barnett, fund manager at Invesco Perpetual.
Flows into European equities from U.S.-based funds stalled in the week ended June 26, after eight weeks of brisk net inflows, data from Thomson Reuters Lipper shows.
"The correction has probably been about right for now and equities are now looking less overvalued and on average look like the right place to be," Invesco's Barnett said.
Deutsche Bank fell 1.8 percent with traders citing vague bid speculation linking it with a move for Commerzbank.
Commerzbank rose 2.5 percent having fallen sharply recently.
Vodafone rose 1 percent, helped by Deutsche Bank's upgrade to "buy" and reports that Liberty Media is taking soundings on an acquisition of larger rival Time Warner Cable by cable operator Charter Communications.
Analysts said, if true, that might mean Vodafone is not forced to raise its bid more for Kabel Deutschland.
The FTSEurofirst 300 was set for its first weekly gain in six weeks and best weekly performance since mid-April, aided by Federal Reserve policymakers' efforts to calm market fears that the U.S. central bank will begin to tighten monetary policy.
The closely watched Chicago purchasing managers index survey of business sentiment in the United States, is due at 1345 GMT.