* FTSEurofirst 300 down 1.7 pct, biggest slide in a month
* Major indexes break below their 50-day moving average
* Doubts arise on impact of rising commodities on earnings
* For up-to-the-minute market news, click on []
By Blaise Robinson
PARIS, April 12 (Reuters) - European stocks suffered their
biggest one-day fall in a month on Tuesday, with the main
indexes breaking below their 50-day moving averages, as Japan's
worsening nuclear crisis sparked a bout of profit taking.
Alcoa's <AA.N> lower-than-expected revenue figures also
fuelled concerns over the upcoming earning season and rattled
investors, who were quick to book profits following an 8 percent
rally over the past month.
Mining and metal stocks featured among the top losers, with
Xstrata <XTA.L> down 4.1 percent and ArcelorMittal <ISPA.AS>
down 3 percent.
The FTSEurofirst 300 <> index of top European shares
dropped 1.7 percent at 1,127.28 points, the index's lowest close
in nearly two weeks.
The benchmark index, as well as the broader STOXX Europe 600
<>, the euro zone's blue chip Euro STOXX 50 <>,
France's CAC 40 <> and Germany's DAX <> all broke
below their 50-day moving average, sending a clear bearish
signal.
"Strictly speaking, valuation levels remain very low, but
there are mounting doubts over the impact of rising energy and
commodity costs, as well as interest rates, on companies'
results. This hasn't been completely priced in yet in earnings
forecasts," said Pierre-Yves Gauthier, head of research at
AlphaValue in Paris.
"Earnings growth will not be as strong as hoped earlier this
year, probably 2-3 percent lower, and forecasts are being
trimmed which is never good for the market. On the positive
side, the long-awaited M&A revival has started. With current
interest rates, making acquisitions seems a no brainer."
Energy shares dropped, with BP <BP.L> down 2.8 percent,
Total <TOTF.PA> down 2.5 percent and Repsol <REP.MC> down 3
percent, as U.S. oil futures tumbled 3.6 percent to around $106
a barrel, trimming a small portion of their recent sharp rally,
as Goldman Sachs warned again of a price reversal and the
International Energy Agency said high prices could be eroding
demand.
Around Europe, UK's FTSE 100 index <> fell 1.5 percent,
Germany's DAX index <> shed 1.4 percent, and France's CAC
40 <> lost 1.5 percent.
Investors' risk aversion was on the rise on Tuesday, with
the Euro STOXX 50 volatility index <.V2TX> surging as much as 15
percent to 22.9 points, a two-week high.
The higher the volatility index, based on sell- and
buy-options on the Euro STOXX 50 <> stocks, the lower
investors' appetite for risky assets such as equities.
"I'm not expecting very positive surprises from the earnings
season. All sorts of negative things should emerge. The dollar
has weakened and we have to adjust (European corporate earnings)
forecasts with that. The pressure will also come from higher
commodity prices," said AXA IM fund manager Chrysoula
Zervoudakis, who manages around 520 million euros ($752
million).
"On the positive side, stocks are very cheap compared with
other asset classes. Companies have started to raise their
dividend, and yields are significant," Zervoudakis said.
According to Thomson Reuters StarMine, STOXX 600 companies
due to post first-quarter results in the upcoming reporting
season are expected to post an average negative earnings
surprise of 1 percent.
(Reporting by Blaise Robinson; additional reporting by Dominic
Lau in London and Alexandre Boksenbaum-Granier in Paris; Editing
by Jon Loades-Carter)
