European shares hold on to small gains ahead of Fed announcement

* FTSEurofirst 300 up 0.3 pct

* Fugro (Xetra: A0ET3V - news) tumbles 26 pct after cancelling payout

* Total and Schneider up after results

By Francesco Canepa

LONDON, Oct 29 (Reuters) - European stocks held on to small

gains on Wednesday, as optimism ahead of a U.S. Federal Reserve

policy announcement outweighed further gloom for the oil

exploration industry.

Dutch marine services group Fugro sank 26 percent

after it warned it would not pay a dividend for 2014 due to

deteriorating markets and price pressure on oil and gas

projects.

The dividend cut, which came hard on the heels of a profit

warning from Italian oil industry services group Saipem (Milan: SPM.MI - news)

on Tuesday, sent shares in sector peer CGG (NYSE: CGG - news)

down 3.4 percent.

Providing some support to the battered energy sector,

investors welcomed oil major Total's decision to

maintain its dividend while pressing ahead with cost cuts after

falling oil prices squeezed its third-quarter profits. The

shares rose 2.4 percent.

The broader FTSEurofirst 300 index of top European

shares was up 0.3 percent at 1,321.32 points by 1534 GMT, rising

for the fourth of the last seven sessions, albeit in low volume.

Trading volume on the index was 40 percent lower than its

average for the past month.

Global shares have rebounded during that time after a sharp

pullback, as investors took heart from generally strong

corporate earnings, especially in the United States, and the

prospect of an accommodative stance from Federal Reserve.

The market expects the Fed's Federal Open Market Committee

to announce it will end years of stimulus measures this month

but also send a soothing message by signalling interest rates

are not likely to rise soon.

"The volumes into the rally are waning," Monument Securities

head of sales, Andy Ash, said. "As we approach the FOMC meeting

and the month end, we have catalysts to pivot once again."

Fiat Chrysler Automobiles (FCA) surged 12 percent

as it unveiled plans to list a 10 percent stake in luxury brand

Ferrari and issue $2.5 billion in convertible bonds to help fund

the parent company's turnaround plan.

Europe bourses in 2014: http://link.reuters.com/pap87v

Asset performance in 2014: http://link.reuters.com/gap87v

Today's European research round-up

OUTLOOK MIXED

European corporate results have been largely in line or

above expectations so far, although outlooks remained mixed.

Industrial group Schneider Electric rose 3.1

percent after reporting a 7 percent rise in third-quarter sales

and saying Western Europe showed long-awaited but fragile signs

of stabilisation.

Europe's largest semiconductor company STMicroelectronics

shed 9.2 percent after posting higher-than-expected

quarterly net profit but saying margins would be flat and

revenue would fall in the final quarter due to a softening

market.

Spanish bank BBVA, down 4.2, weighed on the euro

zone Euro STOXX 50 index as it reported a

lower-than-expected net profit for the first nine months of the

year and said its investment in improving its digital banking

offering could hit profits in the fourth quarter.

About a third of companies listed on the STOXX Europe 600

benchmark index have reported results so far in the

earnings season, with 67 percent of them meeting or beating

profit forecasts, and 59 percent meeting or beating revenue

forecasts, according to Thomson Reuters Starmine data.

In absolute terms, European companies have posted a 13.6

percent rise in quarterly earnings and 0.7 percent in revenue.

(Additional reporting by Blaise Robinson in Paris and Vikram

Subheadar in London; Editing by Andrew Roche)