European shares steady amid growth fears, ahead of Brexit vote

European shares ended flat on Wednesday after swinging between gains and losses through the day, with strength in banks and auto stocks offset by weakness in the technology and healthcare sectors.

The pan-European STOXX 600 index closed up 0.02 percent, having dropped as much as 0.40 percent before swinging to a gain of 0.63 percent, amid fears of a recession and ahead of indicative votes on a series of alternate Brexit options.

Indexes in London and Frankfurt were steady, while Paris slipped 0.1 percent. Madrid, however, rose half a percent buoyed by top lenders.

Bank stocks rallied 0.8 percent after the European Central Bank said it could further delay an interest rate hikes and may look at measures to mitigate the side-effects of sub-zero rates.

Sources told Reuters the measured could include a so-called tiered deposit rate that would exempt banks in part from paying the ECB's 0.40 percent annual charge on excess reserves, an din turn boost their profits.

Banco Santander, BNP Paribas, Lloyds  and were among the biggest boosts to the pan-region benchmark rising between 1.5 percent and 2.2 percent.

Swedbank dropped nearly 12 percent, and was the biggest drag on the index, after the Swedish Economic Crime Authority said it was searching its head office as part of a probe into whether insider trading regulations were breached.

German 10-year yields stayed below zero for the fourth day, while the U.S. bond yield curve remained inverted - a key signal of recession - dampening appetite for risk.

"The yield curve is very much playing on people's minds," said Craig Erlam, senior market analyst at Oanda in London. "Investors are very edgy right now and while we have seen a very strong recovery from the Q4 sell-off of last year, we're still not breaking new highs at this stage."

"I think that represents some nervousness. And the central bank moves, while being there to support the economies and markets, it also reaffirms people's views that there is a very real weakness in the economic outlook and a number of the broader risks to the economy are not improving."

The auto sector snapped a five-session losing run, with Fiat Chrysler up 2.6 percent after the Financial Times report indicated that French carmaker Renault was considering a bid. Renault climbed 2.8 percent.

Daimler AG rose almost 2 percent as it neared the sale of a 50 percent stake in its small-car brand Smart to China's Geely Automobile Holdings Ltd.

Among health stocks, NMC Health slid more than 7 percent, while the tech sector was hit by Apple-supplier Infineon's sales forecast cut.

London's FTSE 100 slid marginally ahead of a closely watched vote by British lawmakers at 1900 GMT on a range of options on how to overcome the political impasse over Brexit.

As the United Kingdom's three-year Brexit crisis spins towards its finale, it is still uncertain how, when or even if it will leave the European Union.

Erlam believes there is nothing the vote could change as far as the market was concerned since they are indicative votes.

"Parliament is not going to get behind anything. There is still a lot of politics to be played, and I still think we've not seen any reason to suggest that parliament has formed a majority opinion around anything," he said adding that market have positioned for most of the expected outcomes.