European shares tread water ahead of Easter break

* FTSEurofirst 300 down 0.2 pct, stuck in tight range

* Investors cautious on Greek negotiations, U.S. payrolls

* Marks & Spencer (Other OTC: MAKSF - news) surges after posting a rise in sales

By Francesco Canepa and Blaise Robinson

LONDON\PARIS, April 2 (Reuters) - European shares dipped on Thursday, trading in a tight range ahead of the Easter break, with Greece still at the forefront of investors' minds after its lenders said Athens needed to do more to unlock financial aid.

Traders also said investors were reluctant to add to their stock holdings, fearing a disappointing U.S. jobs report due out on Friday, when European markets will be shut.

European Union officials said more work was needed on new measures that Athens sent to its creditors on Wednesday. Greece denied it would delay a payment to the International Monetary Fund due on April 9, after the interior minister was quoted as saying Athens would do so if it did not get fresh aid from lenders.

Greece's Athex index was down 0.2 percent, building on a 1.3 percent fall on the previous day. Greek banks fell 1.8 percent.

"Despite the denial, investors are getting concerned about Greece again," said Alexandre Baradez, chief market analyst at IG France. "European leaders are losing patience, and we can't exclude a spike in risk aversion in the coming weeks."

At 1343 GMT, the FTSEurofirst 300 index of top European shares was down 0.2 percent at 1,586.15 points.

Shares (Berlin: DI6.BE - news) in Marks & Spencer rose 5.2 percent after the British retailer posted its best non-food sales performance for nearly four years as it started to put its online distribution problems behind it.

Dutch telecommunications company KPN (Amsterdam: KPN.AS - news) rose 2.9 percent after it confirmed it has had interest from potential buyers of Base, its Belgian operating arm.

Trading volume was thin, with stock markets in Oslo, Copenhagen and Stockholm already shut for the Easter break. Major European markets will be closed from Friday to Monday and reopen on Tuesday.

Data on Wednesday showed U.S. private employers added the smallest number of workers in more than a year in March, raising the risk of a disappointing non-farm payrolls reading on Friday.

"People are reluctant to chase the market higher today because of the U.S. payrolls coming tomorrow," FXCM (NYSE: FXCM - news) market analyst Vincent Ganne said.

"That said, the trend in European stocks remains quite strong, with clients calling trading floors to buy the market every time there's a dip."

Europe bourses in 2015: http://link.reuters.com/pap87v

Asset performance in 2015: http://link.reuters.com/gap87v

Today's European research round-up (Editing by Toby Chopra and Susan Fenton)