European share rally falters; Eni, Total disappoint

* FTSEurofirst 300 up 0.1%; on track for 3rd weekly gain

* Total, Eni fall as results fail to impress investors

* Results boost Michelin, L'Oreal, PPR, Vallourec

PARIS, July 31 - European stocks were slightly up around midday on Friday, as upbeat earnings from firms including L'Oreal and Michelin offset disappointing results from oil majors Total and Eni.

At 1047 GMT the FTSEurofirst 300 index of top European shares was up 0.1 percent at 931.66 points, edging higher after ending at its highest level in nearly nine months on Thursday, and on track to record a third straight week of gains.

"This month's rise might have been a bit too sharp but nonetheless it shows that the spring rally is very solid and since 95 percent of investors missed it they are keen on using any dip in the market as a buying opportunity," said Marc Touati, chief economist at Global Equities, in Paris.

"But the long-term institutional investors, still rattled by a disastrous 2008, are not ready to buy yet," he said.

Stronger than feared corporate earnings have given a second wind to a stock rally that wilted in June after a 38 percent gain in the FTSEurofirst 300 from its record low reached in early March.

Europe's benchmark index, now up 44 percent since its March floor, has surged 14.5 percent over the past three weeks. But it is still down 43 percent from its multi-year peak touched in mid-2007.

Energy shares were the biggest drag on the market on Friday, with France's Total down 2.8 percent and Italy's Eni down 6 percent after the two oil majors followed rivals in posting lower quarterly profits that reflected sharp declines in oil and gas prices.

But investor sentiment was boosted by a flurry of upbeat results and outlooks from other companies including several French groups.

Beauty products firm L'Oreal added 5.6 percent after reporting sales in line with market expectations and saying it sees business improving during the rest of the year.

PPR surged 9.7 percent after the French luxury and retail group posted first-half profits that beat forecasts and JCDecaux , the world's second biggest outdoor advertising group, jumped 14 percent after posting better than expected results.

Tyre maker Michelin rose 4.9 percent after reporting a smaller-than-expected first-half loss.

U.S. GDP AWAITED

British Airways rose 6.8 percent, after the airline said it has cut operation costs by around 6.6 percent since last October, but rival Air France-KLM dropped 4.5 percent after posting a wider than expected quarterly loss, hit by unprofitable fuel hedging contracts.

Vallourec soared 9 percent after the seamless steel tube maker posted quarterly sales that fell less than expected.

But despite the market's gains on Friday, investors remained cautious ahead of key U.S. gross domestic product data, due at 1230 GMT. The data is expected to show the world's biggest economy contracted 1.5 percent, compared with a 5.5 percent contraction recorded for the first quarter.

The data "may well set the tone for the next few weeks on the equity markets," said David Jones, chief market strategist at IG Index.

"A 1.5 percent contraction is being touted as a likely outcome but anything better could well add further momentum to these buoyant markets. On the flipside ... a worse than expected figure may push the balance in favour of a large-scale selloff and see investors begin a new month on a more cautious note."

Around Europe on Friday the UK's FTSE 100 index was flat, Germany's DAX index was down 0.04 percent, and France's CAC 40 was up 0.03 percent.

The FTSEurofirst 300 is up 12 percent year-to-date, while the FTSE 100 is up 4.5 percent, the DAX up 11.4 percent and the CAC up 6.8 percent.