LONDON, Oct 5 (bdnews24.com/Reuters) - European equities edged up in early trade on Friday, extending a four-day winning run as markets looked to the US non-farm payrolls data to cement expectations for a further cut in US interest rates.

Britain's FTSE 100 index showed a 0.4 percent rise, led by miners BHP and Rio Tinto and oil firms as copper prices rose and oil held above $81 a barrel.

Among European losers, shares in Alcatel-Lucent fell 3 percent after the Financial Times said the telecommunications equipment group could lose some AT&T business to Ericsson.

By 0905 GMT, the pan-European FTSEurofirst 300 index was 0.2 percent stronger at 1,575.4, stretching its gains to 1.6 percent this week and over 6 percent this year.

The index is up 11 percent after falling 13 percent in one month from a 6-1/2-year high hit in mid-July as the U.S. housing downturn spread to credit markets and battered global markets.

"I am surprised the market has shrugged off quite a bit of negative news," said Andrea Williams, head of European equities at Royal London Asset Management, adding that upbeat messages from badly hit finanancials had probably helped.

"But I don't think it's over by any means," she said, referring to problems in the financial sector.

Shares in Belgian-Dutch financial services firm Fortis jumped 4 percent, adding to recent gains. Bear Stearns raised its rating on Fortis to "outperform" from "peer perform", while saying the earnings outlook is robust and the group can contain the current credit market dislocation.

Friday marks the last day of the mostly cash 71 billion euro takeover bid for ABN AMRO by a consortium of Royal Bank of Scotland, Fortis and Santander.

Equity markets will now focus on U.S. jobs data to determine if the recovery from the lows in August can be extended.

Around Europe, both Frankfurt's DAX index and Paris's CAC-40 gained 0.1 percent.


PAYROLLS DOMINATE AGENDA

According to a Reuters poll of economists, the U.S. economy is projected to have added a solid but unspectacular 100,000 jobs in September, bouncing back from the first drop in monthly hiring in four years during August.

"The Fed has made it crystal clear that the next policy moves should be data dependent so strong data today could spoil expectations of another imminent Fed ease at the October 31 Federal Open Market Committee," Bear Stearns economists said in a note.

Among the day's losers, shares in Alliance & Leicester dropped 2.3 percent after Deutsche Bank downgraded the stock to "sell", citing the impact of rising wholesale funding costs.

British Land fell 3 percent after the UK's second largest real estate investment trust postponed a part-sale of its flagship retail property asset, citing uncertainty in financial markets. Liberty Land lost 3.4 percent.

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