* FTSEurofirst 300 down 2.1 percent
* Banks take most points off the index
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By Brian Gorman
LONDON, Oct 2 (Reuters) - European shares extended losses on Friday, falling to a new four-week low, after jobless numbers in the United States for September were higher than forecast.
At 1316 GMT, the FTSEurofirst 300 was down 2.1 percent at 960.99 points, having hit a new low for the day of 958.65. The index, which slumped 45 percent last year, is still up 49 percent from the record low of early March.
Banks led the losers, with BNP Paribas, Banco Santander, BBVA, Commerzbank, Credit Suisse, Deutsche Bank, HSBC, Societe Generale, UBS and UniCredit down between 1.8 and 11.4 percent.
U.S. employers cut a deeper-than-expected 263,000 jobs in September, lifting the unemployment rate to 9.8 percent, according to a government report on Friday that fueled fears the weak labour market could undermine economic recovery.
The Labor Department said the unemployment rate was the highest since June 1983 and payrolls had now dropped for 21 consecutive months.
Analysts polled by Reuters had expected non-farm payrolls to drop 180,000 in September
"They were worse than expected" said Mark Priest, senior trader at ETX Capital. "Generally, everything is going to look pretty bad for the rest of the day." The Dow Jones, S&P 500 and Nasdaq Composite were down between 0.7 and 0.8 percent in early trade.
MINERS, OILS FALL
Commodity shares, which have performed strongly in the rally, were out of favour. Crude oil prices were down 2.5 percent at $69.04 a barrel.
Total, ENI, BP, Royal Dutch Shell, Repsol and StatoilHydro were down between 0.8 and 2.6 percent.
Miners Antofagasta, BHP Billiton, Lonmin, Rio Tinto, Vedanta , Xstrata fell between 1.7 and 4.7 percent. European credit derivatives indexes widened further after the jobless data, with the main Europe index breaking over 100 basis points.
The investment-grade Markit iTraxx Europe index was at 100.75 basis points, according to data from Markit, 2.25 basis points wider than before the data report and 7.75 basis points more than late on Thursday.
Across Europe, Britain's FTSE 100 was down 1.6 percent, Germany's DAX fell 1.7 percent and France's CAC 40 shed 2.1 percent.
British insurer Legal & General shed 5.7 percent, following five days of gains that had been fuelled by bid speculation.
Munich Re gained 0.6 percent after receiving a boost from two broker price target upgrades. (Additional reporting by Dominin Lau; Editing by Hans Peters)