European shares fall sharply on debt woes

                                
 * FTSEurofirst 300 index down 1.7 percent
                                
 * Banks mostly lower on funding worries
                                
 * Commodities down over economic recovery woes
                                
 * For up-to-the minute market news, click on [STXNEWS/EU]
                                
 
                                
 By Joanne Frearson
                                
 LONDON, June 29 (Reuters) - European shares fell to their
lowest in nearly three weeks on Tuesday morning, with
commodities and banks falling on investor worries about debt
problems in the euro zone.
                                
 By 0900 GMT, the pan-European FTSEurofirst 300 <.FTEU3>
share index was down 1.7 percent at 1,008.98 points, having been
as low as 1,005.29 earlier, its lowest since June 10.
                                
 "There are still concerns about growth coming to a grinding
halt and that the sovereign debt problems are much higher than
we think," said David Buik, senior partner at BGC partners.
                                
 Investors were also worried that government moves to try and
solve the debt problems by cutting government spending could
derail a fragile recovery.
                                
 Banks were mostly down, with UBS <UBSN.VX>, Credit Suisse
<CSGN.VX> and BBVA <BBVA.MC> down 1.7-2.1 percent.
                                
 Investors were cautious ahead of bank repayments to the
European Central Bank later this week. Banks must repay 442
billion euros ($546 billion) to the ECB on Thursday, leaving a
potential liquidity shortfall in the financial system of over
100 billion euros. [ID:nLDE65R0LE]
                                
 Across Europe, the FTSE 100 <.FTSE> index slipped below the
5,000 point level and was down 1.9 percent, Germany's DAX
<.GDAXI> fell 2.2 percent and France's CAC 40 <.FCHI> slipped
2.4 percent. The Thomson Reuters Peripheral Eurozone Countries
Index <.TRXFLDPIPU> lost 3.3 percent.
                                
 The Euro STOXX 50's <.STOXX50E> failure on Monday to close
above a 38.2 percent retracement of its fall from an April high
to a May low signalled more losses, analysts said, with next
support put at the 23.6 percent retracement level at 2,584.75.
At 0900 GMT, the index was at 2,603.06 points.
                                
 
                                
 COMMODITIES WEIGH
                                
 Energy stocks were under pressure as investors worried
demand for oil would slow, with crude <CLc1> down 2.2 percent.
                                
 BP <BP.L> fell 1.8 percent after it said on Monday its plan
to nearly double the amount of oil it can capture from the Gulf
of Mexico leak will be delayed for about a week by high waves
expected from tropical storm Alex.
                                
 Miners were lower as copper <MCU3=LX> dipped 2.7 percent on
worries about economic recovery.
                                
 Anglo American <AAL.L>, Antofagasta <ANTO.L>, BHP Billiton
<BLT.L>, Eurasian Natural Resources Corporation <ENRC.L>, Rio
Tinto <RIO.L> and Xstrata <XTA.L> fell 3.2-5.1 percent.
 (Reporting by Joanne Frearson; Editing by Dan Lalor)