World watches in horror as terror unfolds in the United States

aircraft hitting the World Trade Center.

Audiences were transfixed by the awful images from New York, where both

World Trade Center towers collapsed.

Key indexes sank on world stock markets and some European airlines canceled

flights to the United States and recalled planes already in the air.

Russian President Vladimir Putin expressed his condolences to the American

people over the terrorist attacks, calling the "terrible tragedies," the Kremlin press service said.

"This mass terrorism is the new evil in our world today," said Prime Minister Tony Blair, who canceled a speech at a trade union conference. "It is perpetrated by fanatics who are utterly indifferent to the sanctity of human life, and we the democracies of this world are going to have to come together and fight it together."

President Jacques Chirac of France, in a nationally televised statement, called the attacks in the United States "monstrous" and expressed his solidarity with the American people.

"France has just learned of these monstrous attacks, there is no other word for it, that have hit America," Chirac said from Rennes, in the western region of Brittany.

Palestinian leader Yasser Arafat and his top aides followed the events at his seaside office in Gaza City, gathered around a TV set.

"I send my condolences to the president, the government and the people for this terrible incident," Arafat said. "We are completely shocked. It's unbelievable."

In Berlin, Foreign Ministry officials huddled in a crisis meeting, and Parliament's vice speaker vice speaker Anke Fuchs told lawmakers a "terrible catastrophe" had happened.

Virtually all German TV channels switched to live coverage. "This is pure mass murder," one commentator said.

Scandinavian Airlines System, SAS, rerouted three airplanes bound for New

York and one for Washington from Norway, Denmark and Sweden.

Flights to the United States were suspended from Portugal, and the Belgian

airline recalled two flights on the way to the United States, diverted others to Canada and canceled all planned flights to the United States.

In Thailand, Suranand Vejjajiva, a spokesman for the office of Prime Minister Thaksin Shinawatra said they were watching the news in disbelief.

A spokesman for Philippine President Gloria Macapagal Arroyo said: "The

president has been monitoring the events since an hour ago and she condemns

what is obviously the worst terrorist attack on a leader of civilized society."

Broadcasters around the world broke into programming to show images of the

disaster.

"It's incredible. I thought I was watching a Hollywood movie," said Hong Kong school teacher Doris Tang.