* FTSEurofirst 300 index closes 0.5 percent lower
* Energy producers drop
* U.S. home sales, durable goods data support recovery story
By Brian Gorman
LONDON, Aug 26 (Reuters) - European shares slipped back from a 10-month closing high on Wednesday, as investors took profits, even as German and U.S. economic data continued to point to recovery.
The pan-European FTSEurofirst 300 index of top shares fell 0.5 percent to close at 973.92 points, breaking a four-day winning streak, and having hit its highest close since early October on Tuesday.
The European benchmark index is still up 50.9 percent from its lifetime low of March 9, as investors have become more confident on the prospects of recovery.
"The market has come a long way, and the economics are still supportive," said Georgina Taylor, equity strategist, Legal & General Investment Management.
"We're just seeing a little profit taking. Nothing has been derailed. Housing data is improving. The only area of concern is consumer spending."
Energy companies were the biggest drag on the index, with crude prices down more than 1 percent to just above $71 a barrel, after the U.S. Energy Information Administration said inventories had risen.
BG Group, BP, Repsol and Total were between 0.9 and 2.3 percent lower.
UK-based oil explorer Tullow Oil fell 3.9 percent after it said interim profits dropped 83 percent on lower oil prices and production.
Other economics news was mostly upbeat. Sales of newly built U.S. single-family homes rose in July to their fastest pace in 10 months, while orders for long-lasting manufactured goods surged, hinting a modest economic recovery was taking shape.
However, some investors chose to focus on orders excluding transportation climbing slightly less than forecast.
Back in Europe, the business climate index of Germany's Ifo, a Munich-based think tank, rose to 90.5 from an upwardly revised 87.4 in July.
"The Ifo figures did not have a momentum effect, despite them being very good. But one also has to acknowledge that the markets are moving on high levels and that people may be following the strategy of 'selling on good news,'" said Joerg Rahn, chief investment officer at wealth management company Marcard, Stein & Co.
Miners also fell. Copper miner Antofagasta lost 4.8 percent after it posted lower-than-expected earnings in the first half and warned prices were likely to remain volatile in the second half.
BHP Billiton, Xstrata, Anglo American and Rio Tinto were down 1.4 to 4.1 percent.
NATIXIS SOARS
Among individual movers, French bank Natixis soared 38.8 percent after majority owner state-backed BPCE said it will guarantee roughly 35 billion euros ($50.12 billion) worth of toxic assets at the investment bank.
Alcatel-Lucent surged 11.9 percent as traders cited market talk of a possible bid from a Chinese manufacturer of telecom gear and a rating upgrade by Natixis.
Heineken, the world's third-largest brewer, rose 7.2 percent, after reporting a rise in first-half operating profit, driven by cost savings, beat forecasts.
Guinness maker Diageo rose 2.6 percent, ahead of full-year results on Thursday.
Suez Environnement soared 11.5 percent after the French utility group reported forecast-topping first-half profit despite a sharp drop in waste business.
However, GDF Suez, the French electricity and gas group, fell 1.7 percent, ahead of first-half results on Thursday.
Swiss Life fell 7 percent after saying it is cutting jobs and costs after two investments in Germany failed to yield hoped-for benefits, even as first-half profits beat forecasts.
Across Europe, the FTSE 100 index closed 0.5 percent lower, Germany's DAX fell 0.6 percent and France's CAC 40 was down 0.3 percent. (Additional reporting by Christoph Steitz in Frankfurt; editing by Rupert Winchester)