European shares pegged back as China, Ukraine concerns mount
* FTSEurofirst 300 falls 1.3 percent
* Risk of pick-up in China defaults could slow growth
* Russia-exposed stocks hit again as sanctions talk builds
* Tod's weighs on luxury sector after earnings
LONDON, March 12 (Reuters) - European shares fell on Wednesday, with cyclical stocks retreating on concerns over Chinese growth, persistent tensions in Ukraine and below-forecast earnings reports.
Miners, carmakers and luxury stocks, which are sensitive to global growth trends, came under the most pressure as the pan-European FTSEurofirst 300 fell 1.3 percent to 1,304.34 points.
The basic resources sector dropped 1.8 percent after Shanghai copper fell by its 5 percent daily limit on concerns over credit markets in China, the world's biggest metals consumer.
London copper hit a 44-month low on growing concerns over credit-linked defaults in China, where copper is often put up as collateral for lending.
"There will be more corporate defaults in China, but provided they can be ringfenced in the smaller banking and finance area, then it won't have a lasting systemic impact on global and financial markets," Jeremy Batstone-Carr, analyst at Charles Stanley, said.
"Markets are on red-alert for the possibility that we'll see more and bigger defaults as time passes. The bigger concern is that wound up in these defaults is the threat of a Chinese slowdown over and above that which is pencilled in," he said.
The FTSEurofirst 300 has now lost 3.3 percent over the last nine sessions.
Stock markets have been under pressure since a further deterioration in the situation in Ukraine at the beginning of last week, when Crimea effectively fell under Russian control, prompting the worst East-West crisis since the Cold War.
Companies exposed to Russia such as car manufacturer Renault and Austria's Raiffeisen Bank came under pressure again on Wednesday. Traders said moves by the EU and the United States to prepare sanctions against Russia risked retaliation that could hurt European economies.
"The Russians are going to take it to the wire ... I don't think investors believe conflict will come to pass, and we'll have to see how deep any potential sanctions are. But it's a flight to safety for the moment," Mike McCudden, head of derivatives at Interactive Investor, said.
The STOXX Europe 600 personal and household goods sector fell 1.9 percent, led by Tod's, which plunged 4.8 percent after the Italian luxury shoemaker posted a fall in 2013 profit and said it was cautious about prospects for 2014.
In the same sector, tobacco firm British American Tobacco was one of several UK-listed stocks to trade without entitlement to its latest dividend payout, sending its shares down 3.2 percent.
Europe bourses in 2014:
Asset performance in 2014:
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