LONDON – Europe’s major stock markets resumed their long losing streak Thursday after German Chancellor Angela Merkel dismissed calls for the European Central Bank to play a bigger role in resolving the debt crisis that’s threatening the 17-country eurozone.

Though she managed to get French President Nicolas Sarkozy to back changes to current EU treaties in order to get the eurozone more unified, she explicitly said there would be no new provision involving the ECB.

“In the treaty changes we are dealing with the question of a fiscal union, a deeper political cooperation … there will be proposals on this, but they have nothing to do with the ECB,” Merkel said.

Many think the ECB is the only institution capable of calming frayed market nerves and Merkel’s continued dismissal of a greater ECB role knocked market sentiment.

Potentially, the ECB has unlimited financial firepower through its ability to print money. However, Germany finds the idea of monetizing debts unappealing.

Merkel also maintained her opposition to the European Commission’s new drive for eurobonds.

Germany has opposed the use of eurobonds and has long called on fiscally wayward member states to clean up their own houses with as little outside intervention as possible. A big worry for Germany is that its low borrowing costs would get diluted if eurobonds came into issue and it would then be forced to pay higher rates to tap bond markets.

The outcome of the meeting in Strasbourg, France, between Merkel, Sarkozy and Italy’s new Premier Mario Monti soured the mood — after all, treaty changes are more often than not a notoriously laborious endeavor.

“While stock markets don’t feel like they are about to go into the nosedive we witnessed in August, there is no sign of any positive news to suggest a compelling reason why we will see notable gains for shares in the months to come,” said David Jones, market strategist at IG Index.

Britain’s FTSE 100 index of leading British shares closed down 0.2 percent to 5,127.57 while Germany’s DAX fell 0.5 percent to 5,428.11. The CAC-40 in France ended less than a point lower at 2,822.55.

The euro meanwhile ended 0.2 percent lower at $1.3330.

Trading though was fairly light as U.S. markets were closed for the Thanksgiving holiday.

Earlier, stocks had been trading noticeably higher as they looked to end their poor run, helped along by a better than expected survey of German business confidence from the Ifo Institute. The unexpected rise in its monthly confidence index for the continent’s biggest economy to 106.6 in November from 106.4 the previous month helped ease frayed nerves following Wednesday’s failed German bond auction, which stoked fears that no one was immune from the crippling debt crisis.

Europe’s debt crisis remains the main focus in the markets and is likely to remain so Friday when U.S. traders – by no means all – return to their desks.