UPDATE 2-European stocks end four-day winning run as UK's FTSE drags

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* FTSE 100 leads declines on ex-dividend trading

* Cyclical sectors hand back some of this week's gains

* Thyssenkrupp slides on flagging losses in steel unit

* TUI sinks to 1 bln euro loss in Q3
(Updates to market close)

By Sruthi Shankar and Sagarika Jaisinghani

Aug 13 (Reuters) - European stocks broke a four-day winning
streak on Thursday as ex-dividend trading and a stronger pound
hit the UK's blue-chip companies, while investors sold off banks
and energy stocks that have outperformed this week.

The pan-European STOXX 600 closed 0.6% lower, with
London's FTSE 100 sliding 1.5% as a jump in the pound
hurt exporters on the index, while heavyweights like AstraZeneca
, BP, and GlaxoSmithKline traded without
entitlement to a dividend payout, hitting their shares.

Reversing a recent trend, investors favoured pockets of
markets that have remained resilient in the wake of the
coronavirus crisis such as the technology sector. On Wall
Street, Apple was set to record $2 trillion in market
capitalisation.

That left some of the cyclical sectors that are more exposed
to an economic downturn, such as banks, oil & gas
, miners and automakers, falling between
0.8% and 1.9%.

Geir Lode, head of global equities international at
Federated Hermes, noted that it is difficult to gauge whether a
rally in these cheaper stocks will be sustained.

"It reflects the uncertainty that still pervades the world
as we continue to negotiate our way back to normality as well as
increasing U.S.-China tensions," Lode wrote in a note.

After a U.S. move to ban two popular Chinese apps last week,
investors were nervous about upcoming talks between Beijing and
Washington officials over a trade deal agreed earlier this year.

Meanwhile, U.S. Democrats and Republicans remain deadlocked
after weeks of wrangling over a fifth coronavirus aid bill to
support a struggling economy.

Trillions of dollars in stimulus and a stellar rally in
technology stocks have helped the U.S. S&P 500 index
reach striking distance of a record high. The European blue-chip
index is still about 15% below its February peak, but
the pace of recovery for both from a market crash in March has
been similar.

Weak earnings also dented the mood, with struggling
conglomerate Thyssenkrupp plunging 16.3% after it said
its steel unit would rack up 1 billion euros ($1.2 billion) in
operating losses this year, raising pressure to fix or sell the
division.

TUI, the world's largest tourism company, fell 6.2%
as it sank to a 1.1 billion euro ($1.30 billion) loss in the
third quarter due to the COVID-19 pandemic.

Danish brewer Carlsberg slid 5.8% on a warning
that lockdowns will impact sales in the second half of the year
in its key markets of China and Western Europe.

(Reporting by Sruthi Shankar in Bengaluru; Additional reporting
by Sagarika Jaisinghani; Editing by Arun Koyyur, Bernard Orr and
Giles Elgood)