* U.S. weekly jobless claims rise unexpectedly
* U.S. existing home sales recover slightly in August
* Dow up 0.1 pct, S&P up 0.1 pct, Nasdaq up 0.7 pct (Updates to midday, changes byline)
By Edward Krudy
NEW YORK, Sept 23 (Reuters) - The S&P 500 held an important support level on Thursday after coming under pressure from more weak economic data in the United States and Europe, a sign the recent stocks breakout could hold.
Hard selling at the open pushed the broad-based index down almost 1 percent and below the key 1,130 mark -- a level that it blew past on Monday - before it recovered to post moderate gains helped by technology stocks.
"It's a hodgepodge of data." said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research in Cincinnati. "The bottom line is we're holding that breakout at the 1,130 level,
Stocks have traded above major technical lines this week. But with persistently low trading volume at levels about 20 percent less compared with last year's average, some investors have been doubtful of the recent rally's sustainability.
Helping the technology sector, software maker Red Hat Inc jumped more than 11 percent after posting earnings that beat Wall Street's estimates, while Bed Bath & Beyond buoyed the Nasdaq, rising nearly 4 percent, a day after its earnings also exceeded forecasts.
The Dow Jones industrial average gained 9.77 points, or 0.09 percent, to 10,749.08. The Standard & Poor's 500 Index inched up 0.70 of a point, or 0.06 percent, to 1,134.98. The Nasdaq Composite Index added 16.24 points, or 0.70 percent, to 2,350.79.
The S&P 500 has rallied nearly 9 percent in the first three weeks of September as fears of a double-dip recession subside.
Weekly claims for jobless insurance jumped unexpectedly, highlighting continued weakness in the labor market, while existing home sales rose in August, but from severely depressed levels.
"It is in line with expectations but keep in mind that this number is disastrously low," said Chad Morganlander, portfolio manager at Stifel Nicolaus & Co in Florham Park, New Jersey, referring to the housing data. "Anyone that would think this is a positive number is woefully confused."
European stocks fell after data showed the pace of growth in the euro zone's services and manufacturing sectors slowed more than expected this month, rekindling worries about economic recovery in the region.
Big technology companies also helped the Nasdaq. Apple Inc rose 1.3 percent to $291.56, and was the biggest boost to the index, while Intel Corp added 1.2 percent to $19.24. The S&P technology index rose 0.8 percent.
Bionovo Inc shares soared 54 percent to $1.88 after the U.S. health regulators accepted the chemistry, manufacturing and controls plan for its lead drug candidate, Menerba, an experimental treatment for hot flashes related to menopause.
Red Hat Inc rose after it reported a second-quarter profit above Wall Street's forecasts as sales of its software rose sharply. The stock climbed 10.5 percent to $40.58.
Bed Bath & Beyond Inc also reported results that beat quarterly profit and sales estimates. It boosted its full-year forecast, sending the stock up 3.7 percent to $43.62. (Reporting by Edward Krudy; Additional reporting by Leah Schnurr; Editing by Jan Paschal)