European shares advanced for a third day on Friday, as news that British Airways and Iberia are set to merge offset data showing German and French third-quarter GDP growth came in below expectations.
By 0930 GMT, the FTSEurofirst 300 index of top European shares was up 0.2 percent at 1,017.12 points after hitting a three-week closing high in the previous session.
Shares in British Airways and Iberia gained 2.8 percent and 2.3 percent respectively after they announced on Thursday a preliminary agreement for a $7 billion merger to create the world's third-largest airline by sales.
The DJ STOXX European travel & leisure index was the biggest sectoral gainer, up 1.2 percent.
But preliminary data showed that the third-quarter GDP of Germany and France grew at a slower-than-expected pace.,
"The market moves between hopes and fears. GDP data was weaker than expected, but investors will focus on consumer data from the U.S. later today," said Heinz-Gerd Sonnenschein, equity strategist at Postbank.
"Yesterday, volumes had been very low already and this continues today. One could almost say that we're in a pre-Christmas tranquility."
Across Europe, the FTSE 100 index was up 0.1 percent, Germany's DAX was up 0.3 and France's CAC 40 was 0.2 percent lower.
NATIXIS FALLS, VIVENDI UP
Later in the session, the focus will be on U.S. import price data and preliminary Michigan sentiment for November.
"Trade balance and import price data are on the calendar in the US. The latter should come in higher due to the increase in oil prices," Helaba analysts wrote.
"The preliminary consumer confidence from the University of Michigan will probably be the main focus of attention. A slight deterioration in sentiment cannot be ruled out."
Shares in Vivendi advanced 1.5 percent after Europe's largest entertainment group posted better-than-expected third quarter results. The DJ STOXX European media index rose 0.4 percent.
On the downside, banks weighed on the European index, with BNP Paribas, Commerzbank and Credit Suisse down 0.2 to 1.1 percent. But the DJ STOXX European banking index was 0.1 percent higher.
Shares in Natixis fell 4.6 percent, as the French investment bank's first quarterly profit in over a year failed to please investors.
"Following a high-profile change in management team in the second quarter, together with a 1 billion euro 'kitchen sinking' exercise and a guarantee on legacy assets by the parent bank, the market expected the company to beat consensus in the third quarter," Citigroup analysts wrote in a note.
