(Reuters) - European shares slipped in early trade on Thursday, as caution persisted over the  euro zonedebt crisis after Portugal moved closer to requiring a bailout.

By 0807 GMT, the pan-European FTSEurofirst 300  .FTEU3  index of top shares was down 0.3 percent at 1,109.24 points, with Portugal's PSI 20 .PSI20 and Spain's Ibex  .IBEX  both falling around 1 percent.

A bailout for highly indebted  Portugal  looked increasingly likely after its prime minister resigned following parliament's rejection of the government's austerity measures, in a move which could prevent European Union (EU) leaders from taking tough decisions to address the region's debt crisis at a summit on Thursday. [ID:nLDE72M2OC]

" If Portugal is going to require some loans from the (EU) funding facility the risk is that if there is some difficulty somewhere else the facility is going to be exhausted," said Mike Lenhoff, cheif strategist at Brewin Dolphin.

Falls in peripheral banks dragged the STOXX Europe 600 banking index .SX7P down 0.6 percent, with sector was also weighed down by ratings agency Moody's cut to its ratings of 30 Spanish banks. [ID:nWEA0516] (Reporting by Harpreet Bhal)