Australia shares give up gains as banks end rally, iron ore prices down

* Banks sold down after monthlong rally

* Falling iron ore prices drag

* Reliability (Other OTC: RLBY - news) of jobs data still in doubt (Adds analysis, quotes, stocks on the move)

By Byron Kaye

SYDNEY, November 6 (Reuters) - Australian shares gave up early advances to be lower by mid-session on Thursday as investors sold down banks before they trade ex-dividend and falling iron ore prices dragged down miners.

An unusual move by the Australian Bureau of Statistics to re-state past employment data also weighed on sentiment, traders and economists said, because it raised doubts about the veracity of official jobs data.

Stocks rallied at the open on hopes that a sweeping Republican mid-term election victory might inject momentum into the United States economy, but quickly retreated as investors cashed in on bank stocks before several banks trade ex-dividend next week.

"People are taking profits because the banks have rallied pretty hard from early October," said Quay Equities head of trading Tristan K'Nell.

"A few of them are probably seeing that the profit that they make from the trades is better than the risk of holding the stock into ex-dividend."

Largely unsurprising monthly employment data was overshadowed by questions about why the statistics bureau which compiles it was forced to revise several previous months' figures, K'Nell added.

By 0100 GMT the S&P/ASX 200 index wsa down 0.2 percent or 11.2 points at 5506.20.

Banks were the biggest weight on the market, with Westpac Banking Corp down 1.24 percent at A$34.16, Commonwealth Bank of Australia off by 0.8 percent at A$80.88, National Australia Bank 0.7 percent lower at A$34.19 and Australia and New Zealand Banking Group down 0.6 percent at A$33.58.

Miners were weaker after iron ore prices tumbled on concerns of dwindling demand from China, and gold prices fell. Fortescue Metals Group Ltd lost 3 percent to A$3.20 and gold giant Newcrest Mining dipped 2 percent to A$8.64.

Engineering services company UGL dropped 11 percent to A$6.15 after it revealed it was exposed to cost blowouts at a power plant construction project.

Television broadcaster Ten Network Holdings Ltd jumped 6 percent after it confirmed it hired an investment bank to help it assess options following media reports it was being assessed for possible takeover.

Media giant News Corp's Australian-listed stock rose 7 percent to A$18.09 after it reported quarterly revenue and profit above estimates.

In the U.S. overnight, the S&P 500 and Dow advanced to records after Republicans took control of the Senate, allaying fears of drawn-out runoffs and raising investor hopes for more business- and energy-friendly policies.

The Dow Jones industrial average closed up 0.58 percent at 17,484.53, the S&P 500 gained 0.57 percent to 2,023.57 and the Nasdaq Composite dipped 0.06 percent to 4,620.72.

New Zealand's benchmark NZX 50 index was 0.2 percent or 13 points higher at 5415.1.

(Editing by Eric Meijer)