* FTSEurofirst 300 index down 0.3 percent
* Insurers hit by nuclear plant explosion
* Aggreko gains on plant blast
* For up-to-the minute market news, click on []
By Joanne Frearson
LONDON, March 14 (Reuters) - European shares fell on Monday
to their lowest level in three months as investors worried about
the impact of Friday's earthquake and tsunami in Japan.
By 1003 GMT, the pan-European FTSEurofirst 300 <>
index of top shares was down 0.3 percent at 1,119.48 points
after hitting its lowest close since Dec. 31 2010 on Friday.
Insurers such as Munich Re <MUVGn.DE> were among the biggest
decliners on concern about the cost of the Japanese disaster,
while companies in the nuclear sector dropped on worries of
increasing safety costs and Renault <RENA.PA> fell as partner
Nissan <7201.T> closed plants in Japan.
On the technical front the index found support at the 61.8
pct retracement level of the November-February uptrend after
breaching it earlier in the session.
A hydrogen explosion at the No. 3 reactor of the quake-hit
Fukushima Daiichi nuclear power plant has left authorities
scrambling to prevent a meltdown, with analyst fearing that the
potential costs to businesses could soar. []
Lothar Mentel, chief investment officer at Octopus, which
has 2.5 billion sterling ($4 billion) assets under management,
said investors would wait and see how the nuclear situation in
Japan develops but he was not "seeing any necessity to change
European portfolios" for the time being.
Mental said investors might start to re-focus their
attention on the positive developments in the euro zone with the
bailout fund.
Over the weekend, European leaders reached an unexpected
agreement to strengthen the bloc's bailout fund, make its loans
cheaper and lower the interest rate on funds extended to Greece.
The insurance sector was hardest hit by the earthquake,
extending declines from the previous session as risk modeling
company AIR Worldwide said the insurance cost of the quake could
reach $35 billion even before the tsunami is accounted for.
[]
The STOXX Europe 600 Insurance <.SXIP> fell 0.8 percent,
with Swiss re <RUKN.VX>, Hannover Re <HNRGn.DE> and Munich Re
down 3.3 to 4.6 percent in volumes of between 144.4 and 303.2
percent of the 90-day averages.
But JPMorgan said in a note any weakness on the reinsurance
could be a buying opportunity, because large losses following
natural disasters normally lead to price rises.
NUCLEAR STOCKS FALL
Companies involved in the nuclear sector were also tumbled
as the crisis reignited concerns over safety in the area.
French reactor maker Areva <CEPFi.PA> dropped 7.9 percent,
with volumes at 430.6 percent of its 90-day average and nuclear
power producer EDF <EDF.PA> was down 3.7 percent, with volume at
193.3 percent of its 90 day-average.
"There are further worries about aftershocks and tsunamis
and the possible costs to businesses. There are fears how these
nuclear reactors can cope and any negative news will certainly
weigh on the market," Matt Brown, trader at Catalyst Markets
said.
Investors favoured renewable energy stocks instead on hopes
there would be a faster shift towards the area following the
nuclear concerns.
Traders bought SolarWorld <SWVG.DE>, which jumped 11.9
percent, and Nordex <NDXG.DE>, which soared 18.9 percent, with
volumes more than double their 90-day average.
Elsewhere Aggreko <AGGK.L> gained 5 percent, with volume at
100 percent of its 90-day average on hopes demand would increase
for the temporary power provider after the nuclear power plant
explosion.
Carmakers were also among the worst performers, with Renault
down 3.3 percent as Nissan, which the company has a significant
stake in, dropped 9.5 percent in Tokyo, after it shut all four
of its auto assembly plants in Japan.
The VDAX-NEW volatility index <.V1XI>, one of Europe's main
barometers of anxiety, rose 6.5 percent as investors fretted
about the impact of Japan's earthquake.
Across Europe, the FTSE 100 <> index was flat,
Germany's DAX <> was down 1 percent and France's CAC 40
<> was down 0.1 percent.
(Editing by David Holmes)
