* FTSEurofirst 300 down 0.4 pct, off lows
* Index regains poise, volatility dips from 7 month high
* ARM, KPN, BP all fall after results
* UBS bucks trend, helps banks outperform
LONDON, Feb 4 (Reuters) - European shares followed Asian and U.S. markets lower on Tuesday on concerns about the global economic outlook and on disappointing earnings reports from the likes of oil major BP and chip designer ARM.
Stocks pared some losses, however, after better-than-expected UK construction data, which reinforced optimism about the UK economy and also sent the euro lower against the pound.
The pan-European FTSEurofirst 300 was down 0.4 percent at 1,268.67 by 1122 GMT, retracing part of an early 0.8 percent slide but still down more than 5.7 percent over the last eight trading sessions.
"After the falls at the open, that's possibly the low for at least a short while, with some better construction data helping (shares higher)," Simon Clark, trader at ETX Capital, said.
"No one's getting too carried away, certainly before the U.S. comes in, given how much they can change things."
In a sign of returning calm among investors, volatility - a gauge of "fear" in sentiment - retreated from a 7 month closing high despite ticking up at the open.
Recent concerns over emerging markets were compounded in the previous session by an unexpected drop in U.S. factory data, which hit European equities in late trade on Monday.
Wall Street extended falls after the European market close, with Japan's Nikkei also down 4.2 percent on concerns about the U.S. economy.
Europe's worst-performing shares were earnings-driven. ARM fell 3.6 percent after royalty revenue came in below forecasts. Although this was offset by an increase in new licence sales to deliver broadly in-line results, analysts at Liberum raised concerns over the trend.
"We no longer think licensing is necessarily a driver of future royalties for ARM ... Overall, these results will continue to stoke fears of a further slowdown in ARM's royalty trends." Liberum said in a note.
Dutch telecom company KPN opened as much as 5.7 percent lower after reporting a lower-than-expected profit following a revenue squeeze, while BP dipped 1.4 percent after fourth-quarter profits were hit by refining weakness.
Out of the 18 percent of companies on the DJ STOXX Europe 600 to have reported earnings so far, 45 percent of them have missed expectations, with the biggest negative surprises coming from the oil & gas and telecom sectors, Thomson Reuters data shows.
Banks outperformed on Tuesday after UBS announced a higher-than-expected profit and dividend, sending its shares up 5.8 percent.
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