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European shares retreat from 4-week high on poor data

* FTSEurofirst 300 index falls 0.3 percent

* Miners slip on disappointing China data

* Randstad slumps, warns of only gradual improvement

* BAE Systems fall after warning on earnings

LONDON, Feb 20 (Reuters) - European shares retreated from four-week highs late on Thursday, with some weaker-than-expected data releases and a poor company earnings outlook hurting cyclical sectors such as mining and industrials.

The market trimmed losses in afternoon trading after data showed U.S. manufacturing activity accelerated in February at its fastest pace in nearly four years, but overall sentiment remained fragile after poor data from China, France and U.S. mid-Atlantic region.

The European basic resources index fell 1.5 percent to the bottom of sectoral losers after China's flash Markit/HSBC Purchasing Managers' Index fell to a seven-month low of 48.3 in February, suggesting a manufacturing contraction in China, the world's top metals consumer.

Investors were also rattled by surveys showing weakness in France's service sector and in manufacturing in the U.S. mid-Atlantic region in February, while the minutes of the U.S. central bank's meeting indicated it might keep trimming its stimulus.

"While we expect the recovery to continue during the course of this year, the market remains volatile in the near term as investors are nervous on the back of the U.S. tapering story," Henk Potts, equity strategist at Barclays Wealth, said.

"Chinese PMI data has been disappointing, but ... long-term fundamentals for China remain good and we are still talking about 7 to 8 percent growth per annum over the course of the next five years."

Some other cyclical sectors lost ground, with the industrial goods and services index falling 0.9 percent, led lower by Europe's biggest defence contractor BAE Systems.

BAE shares fell 8.5 percent after the company warned its earnings could drop by up to 10 percent this year as a result of U.S. spending cuts.

Dutch staffing company Randstad fell 10.5 percent to make it the worst-performing FTSEurofirst 300 stock in percentage terms because the company expects only a gradual improvement in the current quarter due to the patchy nature of the fledgling global economic recovery.

The FTSEurofirst 300 was down 0.3 percent at 1,334.83 points by 1535 GMT after falling to 1,324.36, its lowest in a week, after hitting its highest since late January on Wednesday.

"The economic numbers are mixed. People are taking a step back and waiting for more visibility on the global economy before going back in to push markets higher," said Francois Savary, chief investment officer at Swiss bank Reyl.

MORE WEAKNESS EXPECTED

Darren Courtney-Cook, head of trading at Central Markets Investment Management, said lingering signs of weakness in the global economy could lead to more sell-offs in coming sessions on European equity markets.

"We've had bad Chinese data and the very fact that there is chatter about the Fed changing its guidance on rates is also weighing on sentiment," said Courtney-Cook, who said he had sold positions on Germany's DAX futures contract at 9,700 points before buying back in at 9,500 points.

Toby Campbell-Gray, head of trading at Tavira Securities, also expected European shares to fall in the next few sessions but remained more bullish longer-term over 2014, and Reyl's Savary said equities remained his preferred asset class.

"I do see the market as being a little bit softer in the next few days but I would use days like this to pick up quality stocks," said Campbell-Gray.

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