* FTSEurofirst 300 falls 0.7 percent
* Tod's weighs on luxury sector after earnings
* Possibility of pick-up in China defaults could slow growth
By Alistair Smout
LONDON, March 12 (Reuters) - European shares fell onWednesday, weighed down by below-forecast earnings reports andfears of more corporate defaults in China as a persistentdecline in the copper price hit the mining sector.
The STOXX Europe 600 personal and household goods sector fell 1.5 percent, to be the top sectoral decliner, ledlower by a 4.2 percent drop in Tod's after the Italianluxury shoemaker posted a drop in 2013 profit and said it wascautious about prospects for 2014.
Fellow luxury goods firm Swatch fell 1.2 percentand, in the same sector, tobacco firm British American Tobacco (LSE: BATS.L - news) , was one of several UK-listed stocks to trade withoutentitlement to its latest dividend payout, hitting its shares.
The basic resources sector was also a heavy faller,down 1.2 percent after Shanghai copper fell by its five percentdaily limit.
London copper hit a 44-month low on growing concerns overcredit-linked defaults in China, the world's top consumer of themetal where copper is often put up as collateral for lending.
"There will be more corporate defaults in China, butprovided they can be ringfenced in the smaller banking andfinance area, the it won't have a lasting systemic impact onglobal and financial markets," Jeremy Batstone-Carr, analyst atCharles Stanley (LSE: CAY.L - news) , said.
"Markets are on red-alert for the possibility that we'll seemore and bigger defaults as time passes. The bigger concern isthat wound up in these defaults is the threat of a Chineseslowdown over and above that which is pencilled in," he said.
The pan-European FTSEurofirst 300 fell 0.7 percentto 1,312.36 points, taking falls in the last 9 days to 2.7percent.
Stock markets have been under pressure since a deteriorationin the situation in Ukraine at the beginning of last week, whenCrimea effectively fell under Russian control, prompting theworst East-West crisis since the Cold War.
While traders cited the preparation of sanctions by the EUand United States against Russia as risking retaliation thatcould hurt economies in the region, the crisis was seen ashaving less of an impact than it had done in recent sessions.
"Event risk for Ukraine is now almost fully priced in," AlexChehade, Senior Dealer at TradeNext, said in a note.
"There will be no solution in the near term but it seemsthe idea of armed conflict is currently shelved."
Europe bourses in 2014:
Asset performance in 2014:
Today's European research round-up
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