As global stocks hit a fresh record high, the pan-European STOXX 600 index was down 0.31 percent, while Spain's IBEX fell as much as 3 percent, its biggest daily fall since August last year.
Spain's government bond yields rose to their highest since March on Wednesday, stretching the gap over German peers to its widest in five months.
"Wall Street is going from one record high to another record as positive momentum persists — but eurozone equities have failed to follow amid ongoing jitters following the unofficial independence referendum in Catalonia," NFS Macro analyst Nick Stamenkovic told AFP.
Catalonia-headquartered Banco Sabadell led the IBEX lower. Spanish banks weighed on the eurozone banking index, down 2.3 percent and on track for its worst fall in weeks with all stocks in the red.
"The underperformance is across asset classes as well - Spanish bonds are also underperforming," Investec economist Ryan Djajasaputra told the news agency Reuters.
"If you look at the European markets, the continued political worries in Spain is the main driver, and that uncertainty seems likely to continue if the regional government declares independence," Djajasaputra said.
Carles Puigdemont's regional Catalan government claimed that 2.26 million people took part in the recent referendum, 42 percent of the electorate. It said that 90 percent of those who voted backed independence, although polls indicate Catalans are split.
The European Parliament is to debate the Catalonia crisis later on Wednesday.
Meanwhile, a grouping of Catalans opposed to independence called for supporters to join a counter-demonstration in Barcelona on Sunday. The call was backed by the regional branch of Spain's governing conservative Popular Party.
jbh/uhe (Reuters, AFP)