european shares tumble on uk plot wall st fall

LONDON, Aug 10 (Reuters) - European shares dropped 1 percent
on Thursday after British police said they had thwarted a plot
to blow up aircraft in mid-flight and as Wall Street tumbled
late in the session on worries over slowing growth.

Sterling slipped on news of the plot before recovering.
Britain raised its security threat level to "critical", which
means it expects an attack imminently.

British Airways fell 3.5 percent. It said it had
banned all hand luggage from planes leaving the UK, on
government advice, and that no items such as laptops or mobile
phones would be allowed in its cabins.

Ryanair fell 3 percent and Lufthansa
slipped 2.3 percent. U.S. airlines had also fallen overnight on
worries about a slowdown in demand, against a backdrop of rising
fuel costs.

By 0712 GMT, the FTSEurofirst 300 <.FTEU3> index of leading
European shares had shed 1.1 percent to 1,326.23. Britain's FTSE
100 <.FTSE> lost 1.1 percent to 5,794 points.

Germany's DAX <.GDAXI> fell 1.5 percent and France's CAC 40
<.FCHI> slipped 1.1 percent.

"This sort of news has a very negative influence on markets,
investors are certainly going to be hesitant and cautious. Any
terrorist threat is not good for the likes of British Airways,"
said Ian Griffiths, trader at CMC Markets.

In other news, Deutsche Telekom shares almost 10
percent after second-quarter core earnings fell 7.2 percent,
missing analysts' expectations.