Europe's main stock markets dropped by more than one percent in early trading on Friday, building on sharp losses suffered a day earlier caused by worries about the threat of a debt default from Dubai. London's benchmark FTSE 100 index fell 1.06 percent to 5,152.86 points shortly after the start of European trading. Frankfurt's DAX 30 shed 1.32 percent to 5,540.34 points and in Paris the CAC 40 lost 1.08 percent to 3,639.66. The losses came after Europe's major stock markets had plunged by more than three percent on Thursday after Dubai's shock call to suspend the debt of a key state company fuelled anxiety over heavy public borrowing. The Dubai situation spooked investors across Asia on Friday, as Hong Kong's Hang Seng Index slumped almost five percent by the close. 