* Global stocks retreat from record highs
* Bank, energy stocks weigh on Wall Street
* Investors await substantive policy update from Trump (Updates with close of European markets)
By Chuck Mikolajczak
NEW YORK, Feb 17 (Reuters) - Stocks on major world markets retreated on Friday in the wake of consecutive sessions of record highs, as investors awaited clarity on U.S. President Donald Trump's tax and trade policies.
Despite the decline, the MSCI All-Country World index remained on track for its fourth straight week of gains, its longest winning streak in a nearly a year, after rising to a record high on Thursday on positive signs of global economic growth.
Wall Street was lower for a second straight day as financial stocks, down 0.3 percent, and the energy sector, off 0.8 percent, weighed on equities. Banks had provided a boost earlier in the week when U.S. Federal Reserve Chair Janet Yellen gave testimony that appeared to open the door for a rate hike in March.
Markets have also been supported by expectations of concrete fiscal plans from the Trump administration, which vowed last week to announce a tax reform plan in the coming weeks. The S&P 500 has not registered a decline of 1 percent or more since October 11.
"Expectations were pretty high for the stimulus package and the tax cut package," said David Schiegoleit managing director at U.S. Bank Private Client Reserve in Los Angeles.
"When expectation meets reality, that is when the market adjusts."
The Dow Jones Industrial Average fell 63.6 points, or 0.31 percent, to 20,556.17, the S&P 500 lost 3.55 points, or 0.15 percent, to 2,343.67 and the Nasdaq Composite added 7.08 points, or 0.12 percent, to 5,821.98.
U.S. markets will be closed on Monday for the Presidents Day holiday.
European stocks edged higher as a surge in Unilever shares offset a decline in banking and mining stocks.
MSCI's benchmark global equity index lost 0.29 percent to 443.22 points, retreating from a record high of 444.94 on Thursday. Europe's index of leading 300 stocks closed 0.04 percent higher.
The dollar, up 0.5 percent, improved versus most peers with the exception of the yen, leaving it little changed on the week following Yellen's mildly hawkish view and surprisingly strong U.S. data on retail sales and consumer prices.
The yen rose against major currencies. Concerns about the upcoming French elections and a lack of movement in fiscal changes in the United States stoked safe-haven demand for the Japanese currency.
U.S. Treasury prices gained as concerns over the French election and weak data in Britain added to risk aversion, hurting stock markets and boosting demand for safe-haven U.S. debt.
"We have French elections, which could kind of throw things for a loop here. That is starting to poke up in the market talking circles," said Schiegoleit.
Benchmark 10-year notes were last up 9/32 in price to yield 2.42 percent, down from 2.45 percent late on Thursday, after touching a one-week low of 2.4.
Oil slipped, pressured by oversupply concerns and the stronger dollar, while expectations that an oil output cut by producers might eventually balance the market helped to underpin prices.
Brent crude lost 0.2 percent to $55.55 while U.S. crude declined 0.4 percent to $53.17 a barrel.
Reporting by Chuck Mikolajczak; Editing by Chris Reese and Nick Zieminski