European stocks displayed their worst performance Thursday since March 2009, on reports of poor economic data and news that European banks were under scrutiny, again.

The Vanguard European ETF (NYSEArca: VGK), which tracks companies from major market in Europe, lost 4.2% on Thursday but was slightly up 0.28% on Friday.

The Stoxx Europe 600 index lost 4.6% on Thursday, the biggest loss since March 2009 when the index lost 5.3%, reports Andrea Typhonides for The WSJ.

“[Thursday’s] flash Eurozone PMI figures make grim reading and rise the spectre of a renewed economic downturn in the 17-country region,” Martin van Vliet, economist at ING Bank NV, said. [European Bank ETF Slides on Risk Factor]

Reports showed that the manufacturing and service sector suffered in September across the Eurozone, reflecting the struggle that the union is experiencing due to the sovereign debt crisis. [Global ETFs: IMF Reduces Outlook on World Growth]

In addition, Standard & Poor downgraded the ratings of a group of Italian lenders on Thursday. In France, banks were under fire again, with BNP Paribas refusing to talk with Qatar about a stake sale, with the latter and Societe Generale losing over 5%. iShares MSCI France Index (NYSEArca: EWQ) lost almost 5% after the news, but the fund has gained 0.49% at last check Friday.