* Pan-European index down 1.7 pct this week
* Italy's Leonardo plummets on guidance cut
* Insurer Allianz up after in-line results
* Euro zone earnings beats 51 pct vs 72 pct on S&P500 (ADVISORY- Follow European and UK stock markets in real time on the Reuters Live Markets blog on Eikon, see cpurl://apps.cp./cms/?pageId=livemarkets)
MILAN/LONDON, Nov 10 (Reuters) - European shares suffered their worst week in three months on Friday, as a slowdown in earnings growth and jitters in bond markets spurred profit-taking in a market that remains close to two-year highs.
Leonardo was the biggest loser on Friday, falling 21.6 percent after the Italian defence contractor cut its guidance.
The STOXX 600 fell 0.4 percent, weighed down by weaker industrials, one day after suffering its biggest one-day loss since the end of June.
The pan-European index ended the week down 1.9 percent, its biggest weekly loss since mid-August, but remains up 7.5 percent for the year to date.
Anthilia fund manager Giuseppe Sersale said some investors may be seeking to lock in profits before the year-end.
"There is nothing fundamentally catastrophic behind the apparent correction. Economic growth is strong and earnings are good even though not exceptional," he said.
Mediolanum head of investments Gautam Batra said he was cautious on the outlook for stocks because of an unsettled bond market.
"We would be long riskier assets, but we're not because of the potential for higher bond market volatility," he said.
"We've seen selling of long positions people have held," Batra added, saying that with a strong economic backdrop "a move to neutrality from these investors is noteworthy."
According to Deutsche Bank estimates, earnings per share growth for the STOXX 600 has slowed to 7.6 percent, after reaching double digits in the previous two quarters.
Leonardo lost around a fifth of its value after the state-controlled Italian aerospace and defence company cut its 2017 targets, prompting a raft of broker downgrades on the stock.
JP Morgan downgraded the stock to "neutral" from "overweight", predicting a period of uncertainty ahead and saying other issues may emerge as the scope of problems at its helicopters business was discovered only in the last few weeks.
Second-biggest loser on the STOXX was Elekta, down 10.1 percent, after the Swedish medical equipment company announced a delay of a key product.
Getinge dropped 7.6 percent after setting new financial targets, with Morgan Stanley analysts sceptical it would soon return to past growth rates.
Among top gainers was Spie, up 5.9 percent after its earnings update.
Allianz reversed early gains to end the day down 0.3 percent, underperforming financials stocks. The German insurer posted a 17 percent decline in net profit and provided a less rosy outlook for full-year earnings after a spate of natural disasters.
German engineering company Siemens fell 1.6 percent after Kepler cut its price target following disappointing results on Thursday.
Its decline sent the euro STOXX 50 down 0.6 percent. The euro zone blue-chip index sank 2.6 percent on the week, its biggest weekly loss in three months.
Around 74 percent of companies on the MSCI EMU index have reported results, with 51 percent of companies beating estimates, according to Thomson Reuters data.
Earnings beats on the broader MSCI Europe index are at 55 percent, while in the U.S. S&P 500 beats are at 72 percent.
(Reporting by Danilo Masoni and Helen Reid, editing by Larry King)