* FTSEurofirst 300 down 0.2 pct, Euro STOXX 50 down 0.3 pct
* Trend still very strong, investors buying dips -TradingSat
* SocGen analysts see robust payrolls data sparking rally
* Worries on ultra-low credit spreads seen boosting stocks
By Blaise Robinson
PARIS, Jan 4 (Reuters) - European shares slipped on Friday
as investors cashed in some recent strong gains after minutes
from the U.S. Federal Reserve revealed concern about the bank's
quantitative easing programme.
Investors were also reluctant to increase their exposure to
risk ahead of U.S. non-farm payrolls data for December, due
later in the session, despite Thursday's forecast-beating jobs
data for the private sector.
At 1138 GMT, the FTSEurofirst 300 index of top
European shares was down 0.2 percent at 1,160.22 points,
retreating from near-two-year highs hit in the previous session.
The euro zone's blue chip Euro STOXX 50 index
was down 0.3 percent, at 2,693.15 points.
Both benchmark indexes - which gained 13 and 14 percent
respectively in 2012 - have still risen around 2.2 percent since
the start of January despite Friday's dip.
"The trend remains very strong, a sign that what we've seen
since June is the start of a long-term bull market. There is so
much cash on the sidelines that every pull-back is quickly being
bought," said Alexandre Tixier, analyst at TradingSat.
"We recommend buying the dogs of 2012, the stocks that have
been hammered, such as Peugeot, or Pages Jaunes
Minutes from the Fed's December policy meeting released on
Thursday showed some voting members of the Federal Open Market
Committee were increasingly worried about the potential risks of
the Fed's asset purchases on financial markets, one of the main
engines propelling stocks higher in 2012.
U.S. non-farm payrolls data, due at 1330 GMT on Friday, is
expected to show employers added 150,000 jobs last month. On
Thursday, the ADP National Employment Report showed the private
sector added 215,000 jobs last month, beating economist
forecasts by a big margin.
Analysts at Societe Generale are betting that the non-farm
payrolls will show the creation of 225,000 jobs last month, well
above the consensus.
"Labour market conditions probably improved substantially in
the final month of 2012 ... we expect risky assets to rally
intraday due to the positive surprise element," the analysts
wrote in a note.
Cyclical mining shares were the top losers on Friday, with
Rio Tinto down 1.7 percent and BHP Billiton
dropping 1.2 percent.
Big pharmaceutical stocks, seen as defensive plays, gained
ground, with GlaxoSmithKline up 0.6 percent and Novartis
rising 0.4 percent.
VOLATILITY INDEX FALLING
Around Europe, UK's FTSE 100 index was flat,
Germany's DAX index was down 0.2 percent, and France's
CAC 40 was 0.4 percent lower.
Despite Friday's dip, however, the Euro STOXX 50 Volatility
Index, or VSTOXX, Europe's widely used measure of stock
market risk aversion, was down 2 percent at 17.20, signalling a
rise in investor appetite for stocks even though indexes
"European stocks have been rising mostly because fear has
been receding and with it, aversion for equities. A number of
investors are now getting concerned about missing this rally,"
said Pierre-Yves Gauthier, head of strategy at AlphaValue.
"We're convinced that equities have a lot to recover from
the last two years dominated by fear. But in the short term, it
may just be that markets have moved into complacency territory."
Gauthier sees equities benefiting throughout the year from a
rotation out of corporate bonds, which are showing signs of
overheating, and into stocks.
"A number of fund managers are becoming concerned about
all-time low 'BBB' credit spreads, and this should play out in
favour of stocks," he said.