European shares end off highs after disappointing U.S. data

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* Pan-European STOXX 600 index ends little changed

* Banks make third straight day of gains

* Commerzbank (Xetra: CBK100 - news) rises but regulator says tie-ups are no panacea

* Pharma, oil stocks among biggest losers

* Elekta (LSE: 0O5H.L - news) jumps after results

By Danilo Masoni

MILAN, Sept 1 (Reuters) - European shares closed flat on Thursday, weighed down by pharma and oil stocks, while banks extended a recent rally which was fuelled by expectations of monetary tightening in the United States.

The pan-European STOXX 600 ended 0.04 percent higher, giving up earlier gains after disappointing factory data in the U.S (Other OTC: UBGXF - news) . cast some doubts over the strength of the world's biggest economy.

"If the lights go off in the United States, it's not a great prospect," said Giuseppe Sersale, fund manager at Anthilia Capital Partners in Milan. "The survey does not strengthen expectations that there will be a race to hike rates but we still have jobs data tomorrow".

Hawkish comments from Federal Reserve officials last week had raised chances that the next rate hike could come as early as this month, with Fed Vice Chair Stanley Fischer saying that Friday's jobs report for August will be key.

On the back of such expectations, the euro had weakened against the dollar, helping European equities, while bank stocks had also gained, catching up with a rally in their U.S. peers in anticipation that higher rates will reduce margin pressure.

Europe's STOXX bank index rose 0.8 percent, making its third straight session of gains. In spite of the bounce, many investors are wary about prospects for a sector which continues to struggle with low growth and capital shortfalls.

"The mood surrounding banks has somewhat changed but I believe problems remain unresolved," said Anthilia's Sersale. The bank index has fallen around 20 percent year-to date and it is still the worst sectoral performer in Europe.

Commerzbank rose 2.2 percent, leading gainers on Germany's DAX. The stock was supported this week by news the bank and its bigger rival Deutsche Bank (LSE: 0H7D.L - news) had recently explored prospects for a merger.

On Thursday, Germany's financial watchdog said banking mergers can help to lower costs but are no panacea for the problems confronting the sector in an era of negative central bank interest rates.

Europe's STOXX healthcare index was the biggest sectoral faller, extending recent weakness amid concerns over pricing pressure in the United States. Pharma heavyweights such as Roche, Novartis (LSE: 0QLR.L - news) , Astrazeneca (NYSE: AZN - news) and Glaxo were down between 0.96 and 2.4 percent.

The oil and gas sector index fell 0.7 percent, after crude prices dropped more than 2 percent as investors brushed aside talk that OPEC might freeze production and focused on a growing glut from U.S. crude stockpiles.

Oil services company Subsea 7 (LSE: 0OGK.L - news) fell 4.8 percent, leading losers in the sector and on the broader STOXX index.

The biggest gainer was Belgian investment holding company Ackermans & Van Haaren (LSE: 0GYM.L - news) , which rose 6 percent, rebounding from recent losses after an upgrade to "buy" from "hold" by KBC.

Elekta rose around 1.5 percent after the maker of radiation therapy equipment posted profits above forecast and said demand had been good in emerging markets, with China particularly strong. (Additional reporting by Alistair Smout in London; Editing by Mark Trevelyan)