European shares edged higher in opening deals on Friday, and were set for a positive close on the month, with gainers led by car maker Renault after a rise in quarterly profits and phone group Telecom Italia on stake building news.

The pan-European FTSEurofirst 300 index was up 0.2 per cent, while the euro zone's blue-chip Euro STOXX 50 index also gained 0.2 per cent.

The pan-European FTSEurofirst 300 is up more than 8 per cent so far in October, as the European Central Bank has signalled the possibility of stronger stimulus measures.

Renault rose 5.8 per cent after third-quarter revenue increased 9.4 per cent, lifted by growing business with partners Nissan and Daimler, as well as sales of its own new models in a rebounding European market.

Analysts at SocGen and Nomura lifted their target prices on Renault to 101 euros and 107 euros respectively, both keeping a buy rating on the stock.

Telecom Italia rose sharply for a second day to gain more than 3 percent after the founder of Iliad raised a stake in the Italian telecoms group to 15 per cent.

But British Airways owner IAG fell 4.6 per cent despite upgrading its 2015 profit outlook after third-quarter results beat expectations.

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