Oil and gas leads FTSE higher after broker upgrade

* FTSE 100 index rises 0.4 pct

* Energy stocks benefit from bullish HSBC note

* Risk of less stimulus if US jobs figure tops 200,000

By Alistair Smout

LONDON, Dec 6 (Reuters) - Britain's top share index rose on Friday, led by the oil and gas sector after a bullish note from HSBC, although trade was quiet before a U.S. jobs report that could alter the outlook for monetary stimulus.

Royal Dutch Shell (Xetra: R6C1.DE - news) jumped 2.6 percent after HSBC initiated the stock with an "overweight" rating, accounting for around a third of a 27.51 point rise in the blue-chip FTSE 100 index.

Shell (LSE: RDSB.L - news) 's peers BG and BP (LSE: BP.L - news) also rose after the bank rated them at "overweight," and energy services firm Petrofac (Berlin: P2F.BE - news) was the top FTSE riser, up 4.3 percent, with HSBC also lifting its price for Brent oil.

The FTSE was up 0.4 percent, at 6,525.84 points by 1129 GMT, after closing at its lowest in more than three weeks on Thursday. The index is still up 10 percent this year.

Analysts said the index was likely to trade in a narrow range before the release of U.S. non-farm payrolls at 1330 GMT. The data could provide hints about the timing of a Federal Reserve move to trim stimulus measures, which have helped boost equity markets.

Forecasts are for an increase in non-farm payrolls to 180,000 last month, after October's gain of 204,000. Anything higher may end up hurting equities, by making it more likely the Fed will start to slow its bond-buying operations as early as December.

"If we see a number of 200,000 or above, that raises the chances of tapering this side of Christmas," David Madden, analyst at IG (LSE: IGG.L - news) , said.

"If we had a weak number, though, I don't think that would be celebrated particularly either though ... If it comes in below expectations, we could see a slight move upwards, but the main risks are to the downside today."

Analysts said the index's technical outlook remained good despite recent declines. "Oversold" technical conditions had attracted some buyers in early trading, they said.

The FTSE 100's 14-day relative strength index (RSI) fell to 30 in the previous session from 65 a month ago. An RSI below 30 is considered "oversold" and often results in a rebound. Around 70 is seen as "overbought".

"The overall trend is still up despite recent falls. You have got a risk of a squeeze lower, but the index is likely to push higher thereafter," Lynnden Branigan, a technical analyst at Barclays Capital, said.

"December is generally a good month ... we are still pinning hopes on a recovery later in the year."