BUZZ-Lufthansa rises after Exane upgrade, Norwegian Air falls

** Shares (Berlin: DI6.BE - news) in airline Lufthansa (Xetra: LHAB.DE - news) rise 0.75 percent, among the biggest gainers on a 0.2 percent weaker Dax after an upgrade by Exane BNP Paribas

** The brokerage upgrades the German airline group to "outperform" from "underperform", saying it sees potential for greater stability and pension deficit reduction

** The Exane analysts also initiate on low cost carriers Norwegian Air Shuttle (LSE: 0FGH.L - news) (Underperform) and Wizz Air (Frankfurt: WI2.F - news) (Neutral), writing in a sector note there is doubt over their ability to improve returns amid tough competition

** Shares in Norwegian drop 1.6 percent, Wizz unchanged

** "We firmly stand by our view that European and global demand will remain stubbornly strong, notwithstanding the potential impact of geopolitical events," the Exane analysts write

** With (Other OTC: WWTH - news) airlines set to be more moderate in terms of seat supply on some routes due to rising oil, they predict a "solid returns performance" for 2017/18

** So far this year, traditional airlines have outperformed their low cost rivals, helped by prospects for improving yields and slower declines in ticket prices

** Lufthansa has gained 25 percent this year, Air France-KLM (LSE: 0LN7.L - news) 40 percent, British Airways-owner IAG 21 percent, against a 6 percent rise for easyJet and Ryanair, while Wizz is down 4 percent and Norwegian has lost 17 percent

** Lufthansa is also due to release March traffic figures at 1100 GMT Tuesday (RM (LSE: RM.L - news) : victoria.bryan.thomsonreuters.com@reuters.net)