* FTSEurofirst 300 down 0.6 pct after hitting life low
* Financials, energy stocks worst losers
* Defensive drugmakers limit index declines
By Sitaraman Shankar
LONDON, March 3 (Reuters) - A key European share benchmark hit the lowest level in its near 12-year lifetime on Tuesday as financial and oil stocks led equities lower on concerns over the global economy.
At 1154 GMT, the FTSEurofirst 300 .FTEU3 was down 0.6 percent at 678.43 points, having hit a low of 672.84, its weakest level since inception in July 1997. The broader STOXX 600 .STOXX benchmark was also down 0.6 percent, having hit lows not seen since late 1996.
Bank stocks, the worst affected by the stock slump that has accompanied the crisis on the world's credit markets, were broadly lower.
HSBC (HSBA.L), Credit Suisse (CSGN.VX), UniCredit (CRDI.MI) and Barclays (BARC.L) were down between 2.4 and 6.3 percent.
Insurers were in the red a day after American International Group (AIG.N) posted the biggest quarterly loss in U.S. corporate history, and after Munich Re dropped its medium-term earnings per share goal.
Munich Re fell 1 percent, while Allianz (ALVG.DE), AXA (AXAF.PA), Aviva (AV.L), ING (ING.AS) and Prudential (PRU.L) were down from 2.7 to 9 percent.
"We think that as long as we don't see any recovery on the macroeconomic front, markets will fret about upcoming losses in financials and industrials alike," said Franz Wenzel, strategist at AXA Investment Managers in Paris.
"Monetary policy has been inefficient so far, and there are few anchors to arrest the equities slide," he said.
The FTSEurofirst 300 fell 45 percent last year and is down 18 percent already in 2009. Problems in the subprime mortgage market in the United States, which emerged in 2007, led to a freeze in credit markets, big losses at banks and eventually a recession in top economies, puncturing global stocks.
Across Europe, the FTSE 100 .FTSE index was down 1.5 percent, Germany's DAX .GDAXI was down 0.1 percent, while France's CAC 40 .FCHI was up 0.4 percent.
Euro zone government bond prices fell early in the day as investors booked gains made the previous session, leading to a startling confluence of falling equities and falling bonds. Government bond prices later flattened, while gold was slightly lower at $923.40.
