* FTSEurofirst 300 index closes down 1.1 percent
* Banks, oil shares weigh
* Ericsson results disappoint
By Joanne Frearson
LONDON, Oct 22 (Reuters) - European shares closed lower on Thursday, with banks and oil stocks the major losers and Ericsson falling after disappointing results.
The pan-European FTSEurofirst 300 index of top shares closed down 1.1 percent at 1,014.72 points. The benchmark index is still up 57 percent from its lifetime low on March 9, but down 38 percent since reaching its mid-2007 peak.
"These markets are due for a bout of consolidation, if anyone is looking to book some profits this is as good as time as any," said Mike Lenhoff, strategist at Brewin Dolphin.
"We might get some rough numbers, but if you look at the whole sweep of newsflow which is being reported then I do not think anyone can say that what we have seen so far has been bad," he said.
Banks featured among the biggest losers. Credit Suisse was down 3.5 percent after third-quarter earnings, with analysts pointing to a 16 percent fall in investment banking revenues from the previous quarter and lower pretax profits and margins at the private banking unit.
HSBC, Banco Santander and BNP Paribas were down 1.1 to 2 percent.
Oil stocks fell as crude slipped back 1.1 percent. BG Group , BP, Royal Dutch Shell and Total were 0.8 to 1.5 percent lower.
Mobile network gear maker Ericsson lost 6.2 percent after it reported weaker-than-expected quarterly core earnings and a drop in sales, hit by the global economic downturn.
CHEMICAL STOCKS FALL
Chemical stocks were under pressure. Air Liquide was 2.7 percent lower after sales at the French industrial gases group fell in the third quarter. "Those people who believe that we're on our way to the moon delude themselves. This is a long hard struggle. We've been waiting for weeks for some kind of a pullback after the rally," said David Buik, senior partner at BGC Partners.
Defensive stocks were in favour, with food producer Nestle up 1.4 percent.
Vodafone gained 3.4 percent with traders pointing to a positive read-across from results by U.S. telecoms peer AT&T.
AT&T reported stronger-than-expected third-quarter profit as the popular Apple iPhone helped it land a record number of new wireless customers for the period.
Looking at economic news, the number of U.S. workers filing new claims for unemployment benefits rose more than expected last week, data showed, indicating the labour market remains fragile despite signs of economic revival.
Meanwhile, U.S. home prices fell by a seasonally adjusted 0.3 percent in August, bringing the 12-month decline to 3.6 percent, the Federal Housing Finance Agency said. Across Europe, the FTSE 100 index was down 1 percent, Germany's DAX fell 1.2 percent and France's CAC 40 was 1.4 percent lower. (Additional reporting by Brian Gorman; Editing by Rupert Winchester)