European shares hurt by weak earnings, but Syngenta surges on deal

* Pan-European index down 0.8 pct

* Syngenta (LSE: 0QOP.L - news) rises after agreeing on ChemChina bid

* Fortum (Other OTC: FOJCF - news) , KPN (Amsterdam: KPN.AS - news) fall after weak earnings

* Italian lenders lead bank sector lower (Adds details, updates prices)

By Sudip Kar-Gupta

LONDON, Feb 3 (Reuters) - European shares fell on Wednesday as weak earnings from some leading companies weighed on markets, although Syngenta surged after ChemChina agreed a bid for the Swiss seeds and pesticides group.

The pan-European FTSEurofirst 300 index, which slid 2 percent on Tuesday, was down by 0.8 percent by 1043 GMT. The euro zone's blue-chip Euro STOXX 50 index and Germany's DAX both retreated by 1.2 percent.

Finnish state-controlled utility Fortum slumped 9 percent after posting fourth-quarter earnings dropped more expected. Dutch telecoms group KPN also fell, by 3 percent, after reporting worse-than-expected core earnings.

However, Syngenta rose 5.6 percent after China's state-owned group ChemChina agreed to buy the Swiss company for $43 billion, the largest-ever overseas acquisition by a Chinese company. Syngenta, however, remained below the agreed price with some brokers saying the deal carried high execution risks.

"There are still risks for the deal which might delay the takeover process," Baader Bank (Xetra: 508810 - news) said in a note, citing political headwinds in Switzerland and possible moves by competitors to make the takeover more difficult.

Luxury goods group LVMH also climbed 6 percent after reporting fourth-quarter sales grew more than expected, but watch-maker Swatch tumbled after it reported lower profits and sales.

Of the companies on the European STOXX 600 index that have reported earnings so far, 57 percent have beaten or met market expectations and 43 have missed, according to data from Thomson Reuters StarMine.

"It (Other OTC: ITGL - news) 's been a very mixed bag on the earnings front. Personally, I think a lot of them have been quite disappointing," said Terry Torrison, managing director at Monaco-based McLaren Securities.

Banks declined 2.7 percent, making them the top sectoral faller with Italian lenders leading the way on uncertainty over Rome's plans to help them offload bad loans and after analysts at Citigroup (NYSE: C - news) issued a downbeat note.

Shares (Berlin: DI6.BE - news) in Italy's Monte dei Paschi (Milan: BMPS.MI - news) , Popolare di Milano, UBI and Banco Popolare (Amsterdam: PB8.AS - news) were all down by between 6.8 and 10.4 percent.

Both the FTSEurofirst and DAX have lost about 10 percent this year. World stock markets in general have been hit by signs of a slowdown in China, the world's second-biggest economy and a major consumer of oil and metals.

The DAX is also some 20 percent below a record high reached in April (LSE: 0N69.L - news) 2015, but City of London Markets' trader Markus Huber said it might still be too risky to buy into European stock markets at current levels.

"Much lower prices might be needed in order for sentiment to turn and bargain hunters to be tempted back into the markets," Huber said.

Today's European research round-up (Additional reporting by Danilo Masoni; Editing by Mark Heinrich)