European shares head for positive weekly close, Hugo Boss slumps

* Pan-European FTSEurofirst 300 index up 0.6 pct

* Hugo Boss (Xetra: BOSA.DE - news) shares fall over 10 pct on poor outlook

* Carrefour (Paris: FR0000120172 - news) rises as results show Europe improvement

By Atul Prakash and Danilo Masoni

LONDON/MILAN, Oct (HKSE: 3366-OL.HK - news) 16 (Reuters) - European shares extended the previous session's rally on Friday but gave up some of their early gains after mixed results from U.S (Other OTC: UBGXF - news) . industrial heavyweights.

French retailer Carrefour led the advance on good quarterly results, but Hugo Boss shares slumped more than 10 percent. The fashion house cut its 2015 sales and profit outlook as a slowdown in China and more hesitant shoppers in the United States hurt its third-quarter results.

The pan-European FTSEurofirst 300 index was up 0.6 percent and headed for a weekly gain after closing 1.4 percent higher on Thursday. The index rose 4.4 percent last week.

The advance followed strong gains in Asia on Friday after economic data eased concerns about the pace of recovery in the United States. Expectations that monetary policy will remain accommodative also encouraged investors.

"Europe's main indices are attractively valued on a price-to-earnings basis, and with no shocks in the peak period of earnings reporting season in the U.S., it appears that equity investors may have found a base to build upon after the rout in August and September," said Lorne Baring, managing director of B Capital Wealth Management.

"Easy monetary conditions are clearly going to remain for some time and that is also bolstering sentiment at the moment. We would expect further gains after a rough period for global investors."

Consumer prices fell in the year to September, official data confirmed on Friday. The evidence of inflation will keep pressure on the ECB to increase its asset purchases to boost prices.

Carrefour shares rose 6 percent after Europe's largest retailer reported on Friday that sales accelerated in the third quarter. That reflected an improved performance in southern Europe and resilience in Brazil despite a slowing economy.

European sales beat consensus estimates, Bernstein analysts said, with Spain and Italy particularly good. French sales were in line with expectations and not as strong as the performance Casino reported on Thursday.

The STOXX 600 Healthcare index was best performing sector, rising 1.54 percent. Insulin maker Novo Nordisk (Other OTC: NONOF - news) rose 3.5 percent after approval for rival AstraZeneca (NYSE: AZN - news) 's AZN.L diabetes drug combination was withheld by U.S. health regulators.

The STOXX Europe 600 Oil and Gas index rose 1.1 percent, after crude oil prices ended week-long decline.

Nestle (VTX: NESN.VX - news) fell more than 2 percent after the world's largest packaged food company lowered its full-year outlook. A recall of Maggi noodles in India knocked sales and miscalculated rebates in the United States weighed on the Swiss company's profits.

Sweden's SKF (Stockholm: SKF-A.ST - news) fell 6.5 percent after the world's top bearings maker painted a downbeat picture for the industrial sector. It (Other OTC: ITGL - news) forecast weaker demand ahead as a global slowdown gathered pace, especially in North America and Asia.

Today's European research round-up (Additional reporting by Sudip Kar-Gupta; Editing by Larry King)