FRANKFURT, July 10 (Reuters) - European shares opened sharply lower on Thursday, tracking big falls in the United States overnight on concerns over continued losses in the financial sector and an economic downturn.

At 0718 GMT the FTSE Eurofirst 300 index was 1.4 percent down at 1,164.58 points, led lower by banks and oil and gas groups.

French retailer Carrefour (CARR.PA: Quote, Profile, Research), which had a disappointing second quarter trading update, and French bank Natixis (CNAT.PA: Quote, Profile, Research) were leading losers in Europe, down between 5 and 7 percent.

EADS (EAD.PA: Quote, Profile, Research) fell more than 3 percent after the United States reopened the contest to supply aerial tankers to the air force after the selection process that picked Northrop Grumman (NOC.N: Quote, Profile, Research) and EADS over Boeing (BA.N: Quote, Profile, Research) was found by congressional auditors to be flawed.

In the United States, shares in Fannie Mae (FNM.N: Quote, Profile, Research) and Freddie Mac (FRE.N: Quote, Profile, Research) slumped as investors worried that the two pillars of the U.S. housing market would have to raise billions through share sales. Merrill Lynch MER.N fell after Fitch said it may cut the bank's debt rating.

Techs will be in focus after Cisco (CSCO.O: Quote, Profile, Research) said it saw the economy picking up only early next year.

Investors will also be watching the Bank of England, which is widely expected to hold interest rates at 5 percent at 1100 GMT.

(Reporting by Sylvia Westall)