* FTSEurofirst 300 index up 0.1 percent
* Banks gain, Bayer down
* U.S. GDP unchanged, jobless claims fall
By Joanne Frearson LONDON, Aug 27 (Reuters) - European shares ticked higher in afternoon trade after briefly turning negative on Thursday, following weekly U.S. jobless claims data and confirmation that the U.S. economy shrank less than expected in the second quarter.
By 1326 GMT, the pan-European FTSEurofirst 300 index of top shares was up 0.1 percent at 974.64 points after falling to a low of 970.59 earlier in the session.
"The U.S. GDP figures were not as bad as expected," said Peter Dixon, an economist at Commerzbank. "Markets have demonstrated a lot of volatility in recent days and I think markets will see-saw on the back of good and bad news."
"U.S. jobless figures were a little bit worse than expected, but still were an improvement on the previous week. These numbers are volatile and I would not want to base any kind of assessment on these numbers," he said.
U.S. jobless claims fell last week to 570,000, slightly above the 565,000 predicted by analysts.
Data also showed the U.S. economy contracted at an annualised rate of 1.0 percent in the second-quarter, the same as its initial reading. Analysts had predicted a downwardly revised reading of minus 1.5 percent.
Banks were among the top movers on the European index. UBS, Barclays, Credit Agricole and Nordea Bank were 2.2 to 4.7 percent higher.
On the downside, the chemical sector was the worst performers. German drugmaker Bayer slipped 4.4 percent after traders pointed to concerns that peer Boehringer Ingelheim may report strong data about its rival drug to Bayer's anti-blood-clotting pill Xarelto.
A Reuters poll has shown leading investors have kept their portfolios steady in August, as the northern summer doldrums and caution about how far the global equity market rally can go led many to sit back and wait. (Editing by Jon Loades-Carter)