Portuguese Premier Marcello Caetano arrived in London yesterday following two days of demonstrations by thousands protesting his visit in the wake of reports that his government's troops were committing genocide in Mozambique.

The Spanish Institute of Foreign Missions reported Sunday that one of its missionaries could pinpoint the exact spot in Mozambique where 400 villagers were allegedly slaughtered by Portuguese troops.

The missionary's announcement came after another priest, Adrian Hastings, charged that Portuguese troops had massacred the residents of the village.

'Suspicious'

Yesterday, however, a U. S. State Department spokesman said the department was "suspicious" of Hasting's allegation, because the magnitude of the alleged massacre was greater "than we would think it possible without us knowing anything about it."

"We can't rule out the possibility," of the incident, the spokesman said. "Atrocities do occur on both sides."

The department spokesmen also reported that the British government acquiesced to the demands of Labor and Liberal Party members that they be allowed to debate Caetano in Parliament.

Early yesterday, the spokesman said that he had heard reports that Caetano might be "disinvited" by the British government, but Caetano arrived in London on schedule.