A SHARP drop in German business activity overshadowed an easing downturn in France in April, surveys showed yesterday, raising concerns over a further economic contraction in the eurozone.

Markit's flash eurozone services PMI, an early gauge of business activity each month, rose to 46.6 in April from 46.4 in March, below the 50 line that divides growth from contraction but matching the forecast of economists.

Markit cautioned against taking the rise as a clear sign the region's recession has bottomed out, pointing to a surprise decline in German firms that form the backbone of the eurozone economy.

"Previously, we've seen Germany expand while other countries have contracted - notably Spain, Italy and France," said Chris Williamson, chief economist at Markit.

"Now it seems those contractions are being accompanied by a downturn in the largest economy, Germany, and that will no doubt act as a drag on growth."

There was some respite for French companies, which in March endured their worst month since the depths of the deep recession in 2009, and that helped support the latest wider eurozone PMI.

The eurozone economy shrank 0.6 percent quarter on quarter in the final three months of last year.