Banks led European stocks higher on Friday, following quarterly results from Royal Bank of Scotland (RBS.L), while investors also awaited key U.S. employment figures later in the day.

At 1132 GMT, the FTSEurofirst 300 .FTEU3 index of top European shares was up 0.2 percent at 992.35 points.

The European benchmark has gained almost 54 percent from its lifetime low in March and is up 19.3 percent so far this year.

Banking was the top DJ Stoxx .SX7P sectoral gainer, boosted by part-nationalised Royal Bank of Scotland (RBS.L), which said it more than halved third-quarter losses as impairments fell. 

Shares in the bank were up 7.6 percent.

Banking stocks are shooting up in an over proportional manner compared to the market. Yet this suggests to me that there is still some more risk in those stocks than the market is acknowledging, said Giuseppe-Guido Amato, strategist at Lang & Schwarz.

BNP Paribas (BNPP.PA), Banco Santander (SAN.MC), Credit Suisse (CSGN.VX), Deutsche Bank (DBKGn.DE), HSBC (HSBA.L) and UBS UBS.AG were all up between 0.5 and 2.7 percent.

Across Europe, Britain's FTSE 100 .FTSE and Germany's DAX .GDAXIwere up 0.2 and 0.1 percent, respectively, while France's CAC-40 .FCHIwas down 0.1 percent.

EYES ON JOBS DATA

Investors were awaiting U.S. non-farm payrolls employment data, due at 1330 GMT. According to a Reuters poll, 175,000 jobs were lost in October, down from 263,000 in September.

It's going to get tougher for the market to rise further as economic surprises lessen, said Bernard McAlinden, investment strategist, NCB Stockbrokers. But a good labour report today could see the market testing post-recovery highs soon.

British Airways (BAY.L) climbed 6.2 percent. It swung to a first-half pretax loss of 292 million pounds ($482.4 million), but broker BofA Merrill Lynch, which has a buy recommendation on the stock, said the latest data showed an encouraging trend in the airline's traffic numbers and noted that it sees premium class yields slowly improving. 

On the downside, the world's biggest cement maker, Lafarge SA (LAFP.PA), dropped 4.5 percent after posting a slump in third-quarter sales and profits. 

French cosmetics giant L'Oreal (OREP.PA), too, fell 1.7 percent after saying it saw no pick-up in consumer demand globally but expected improved trading in the fourth quarter. ($1=.6053 pounds)