Frankfurt - European shares slid by about 1 per cent in early trading Tuesday after renewed worries about the world banking industry and fresh recession fears drove down stock prices in New York and across Asia.

Europe's blue-chip Stoxx50 edged down by 1 per cent to 1,784 points shortly after the release of a key indictor showed business confidence in Germany slipping. This in turn helped to fuel concerns about the prospects of a protracted and deep recession.

London's FTSE index dipped by 0.62 per cent as the trading day got underway in Europe's premier stock market.

This was reflected across national bourses with Frankfurt's DAX index sinking 1.8 per cent and Paris' CAC dropping 1.4 per cent. The stock market in Zurich dropped by
1.50 per cent

The downbeat mood also hit shares across Central and Eastern Europe with stocks in Warsaw falling by more than 2 per cent.

Adding to the signs that renewed recession fears were driving share markets, the oil price fell on expectations of a drop in demand as the global economy enters a sharp slowdown.

In early European trading Tuesday, oil had dropped 1.0 per cent to 38.02 dollars a barrel. (dpa)