European shares hit 3-week low, earnings disappoint

* FTSEurofirst 300 index falls 1.4 pct

* Adidas (Other OTC: ADDDF - news) , Banco Espirito Santo shares slump

* Worries about U.S. monetary policy hit sentiment

By Atul Prakash

LONDON, July 31 (Reuters) - Europe's FTSEurofirst 300 share index hit a three-week low on Thursday, led lower by Adidas after the group warned about business in Russia.

Argentina's default and concerns of an early U.S. rate hike also rattled investors.

The broader market was dragged down by sharp declines in some individual stocks following the announcement of their earnings. The broader market sell-off accelerated in the afternoon after the U.S. market opened lower and extended losses later in the session

German sportswear firm Adidas fell 15.2 percent, the top decliner on the FTSEurofirst 300 index, Portugal's Banco Espirito Santo sank nearly 50 percent at one point to a record low after booking a 3.6 billion euro first-half loss and disappointing earnings at Spanish healthcare firm Grifols sent its shares down 11.2 percent.

BES, down 37 percent, pushed Portugal's benchmark PSI 20 index 3.4 percent lower to underperform the wider market, while Adidas dragged Germany's DAX 2 percent down after saying it will scale back plans to expand in Russia and overhaul its golf business.

According to Thomson Reuters StarMine data, about 40 percent of STOXX Europe 600 companies have reported results so far in the earnings season, of which 55 percent have met or beaten profit forecast. On average, quarterly profits are up 7.1 percent year-over-year.

Spanish stocks also came under pressure, with Madrid's IBEX dropping 2.3 percent, as traders cited worries over Spanish companies' exposure to Latin America after Argentina defaulted on its debt on Thursday.

At 1457 GMT, the FTSEurofirst 300 was down 1.4 percent at 1,346.84 points after falling up to 1,346.78, the lowest since early July, with analysts saying the sell-off might continue in the near-term on worries about further monetary tightening in the United States.

"The biggest worry is the uncertainty about the U.S. monetary policy. The strong GDP data and an improving economic outlook have raised the risk of an early rate hike," Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussels, said.

"Tomorrow's U.S. non-farm payrolls data may further cement the view that a rate rise could happen earlier than expected."

Data showed on Wednesday the U.S. economy rebounded sharply in the second quarter as consumers stepped up spending and businesses restocked, while Friday's data is likely to show U.S. non-farm payrolls rose by 233,000 in July, which would mark the sixth month with job growth above 200,000.

Europe bourses in 2014: http://link.reuters.com/pap87v

Asset performance in 2014: http://link.reuters.com/gap87v

Today's European research round-up (Additional reporting by Blaise Robinson in Paris; Editing by Janet Lawrence)