* Europe shares end down 0.1 percent lower
* U.S. home starts buoy market
* Earlier euro zone data, U.S. jobless data all weak
* Metro up on positive sales outlook
By Simon Jessop and Harpreet Bhal
LONDON, Sept 23 (Reuters) - European shares ended slightly weaker on Thursday, although off lows after a recovery in U.S. homes sales from a 13-year trough buoyed sentiment.
A sharp slowdown in euro zone services and manufacturing growth had earlier hit stocks across the region, with a surprise rise in U.S. jobless claims adding to market woes before the existing home sales data helped the index pare losses.
The pan-European FTSEurofirst 300 ended down 0.1 percent at 1,065.92 points, extending losses from the previous session when it ended down 1.5 percent, and in line with a little-changed Wall Street.
"The housing starts were not as bad as they might have been, but they're still not great," said Howard Wheeldon, strategist at BGC Capital Partners.
Concerns about whether attempts to reflate the global economy were succeeding or not were "beginning to weigh on the market" after downbeat comments from the U.S. Federal Reserve earlier this week, added Mike Lenhoff, chief strategist at Brewin Dolphin.
However, the Euro STOXX 50, the euro zone's blue-chip index, rode the late afternoon uptick to end down 0.5 percent at 2,738.61 points, just above the 50-percent Fibonacci retracement of the fall from its April high to a May low.
EXTRA COSTS
The STOXX Europe 600 banking sector was among the biggest fallers, down 0.7 percent.
Irish sovereign credit weakness and the prospect of extra costs in winding down Anglo Irish Bank gave weight to the bank sector bears, as did negative readacross from a bearish Bank of America-Merrill Lynch note on U.S. investment banks, traders said.
Bank of Ireland led the sector fallers, down 5.5 percent, while fellow peripheral euro zone bank Alpha Bank fell 4.4 percent and Credit Suisse ended down 3.2 percent.
Other economy-sensitive stocks also took a hit, with steelmakers chief among the fallers after a bearish note from BofA-Merrill Lynch gave a downbeat outlook for Thyssenkrupp, down 2.2 percent, and ArcelorMittal, down 2 percent, traders said.
Among individual issues, German retailer Metro ended up 2.9 percent after the German retailers association HDE said it expects 2010 sales to rise by a stronger than expected 1.5 percent.
On the downside, drugmaker GlaxoSmithKline fell 1 percent after European health regulators recommended it pull its diabetes drug Avandia off the market due to concerns over heart attack risks. (Editing by David Holmes) ($1=.7461 Euro)