European stocks inched higher before a central bank meeting on Thursday while Asian markets fell, surrendering early gains as investor sentiment remained fragile.

In China, shares fell sharply again, continuing weeks of volatility. The benchmark Shanghai Composite Index plunged to close down 3.32 percent, while the Shenzhen Component Index lost 3.37 percent by the end of trade.

In Europe, markets started weaker but soon stabilised with Britain's FTSE 100 rising 0.1 percent to 5,681.57. Germany's DAX added 0.1 percent to 9,395.74 and France's CAC gained 0.2 percent to 4,133.16. 

Global growth, China and oil

Stock markets have taken a beating in recent weeks, along with the price of oil, with trillions of dollars wiped off global markets over the past two days.

Tumbling oil prices, low global growth forecasts and China's slowing growth have all contributed to the recent selloff.

China's economy grew 6.9 per cent in 2015, according to official figures released on Tuesday, marking the slowest growth in more than a quarter of a century.

The growth missed the 7 percent target that the government had set for the year but matched market expectations.

Oil prices tumbled again by the close of trade on Wednesday, after a brief pause. Benchmark US crude for March delivery was down 12 cents to $28.23 a barrel in electronic trading on the New York Mercantile Exchange.

The European Central Bank meets on Thursday and is expected to keep already record low interest rates on hold. Traders will be watching closely to see what effect the latest market turmoil is having on the bank's decision-makers.

Earlier on Thursday, Tokyo's Nikkei 225 lost 2.4 percent to finish at a fresh 15-month low of 16,017.26, while South Korea's Kospi inched 0.3 percent lower to 1,840.53. Hong Kong's Hang Seng was down 1.3 percent to 18,641.56.

Source: Agencies