Tullow Oil leads Britain's FTSE higher ahead of U.S. jobs data

* FTSE 100 up 0.9 pct, rebounding from previous session's losses

* Chatter of +200,000 jobs added last month helps market

* Tullow Oil (LSE: TLW.L - news) lifted by bid speculation

By Alistair Smout

LONDON, Jan 10 (Reuters) - Britain's top share index rebounded from the previous session's losses on Friday amid talk that U.S. jobs data due later could beat consensus, with Tullow Oil leading the gains on speculation it may be a takeover target.

The blue-chip FTSE 100 index was up 0.9 percent, or 60.16 points, at 6,751.50 points by 1122 GMT.

Volumes were thin, with just a third of an already low 90-day average volume being traded by midsession, as traders awaited the U.S. non-farm payrolls data at 1330 GMT.

A Reuters survey of economists this week forecast that non-farm payrolls probably rose by 196,000 last month, slightly below November's 203,000 gain, but a touch above the monthly average for the three months through November.

However, there were whispers in the market that the number could beat consensus. The data is the first flagship U.S. jobs report since the U.S. Federal Reserve decided to slow its unprecedented monetary stimulus programme last month.

"The rally that we've seen this morning, from conversations we've had so far, seems to point towards the market thinking it could be above 200,000. Anything that high will help ease concerns that they might've started slowing stimulus too early," Toby Morris, sales trader at CMC Markets, said.

Tullow Oil rose 5 percent to top the FTSE 100 leaderboard on speculation that Norway's Statoil (Xetra: DNQ.DE - news) may be eyeing it as a bid target.

"In these oil firms, you have to take some of the takeover talk with a pinch of salt, but there has been a lack of M&A speculation recently, so investors who are looking around for that sort of activity will jump on it," said CMC (BSE: CMCSL.BO - news) 's Morris.

Bernstein analyst Oswald Clint said the Norwegian company's own success at discovering new oil and gas fields in recent years made it less likely that Tullow was on its shopping list, but said Tullow looked undervalued and could be attractive to a range of large companies.

Despite the session's gains, the FTSE 100 has stayed within a tight trading range of 90 points since the beginning of the year and is flat so far in 2014.

McLaren Securities managing director Terry Torrison remained positive on the market, despite an uncharacteristically weak start to the year, as he felt the longer-term backdrop of a recovering economy and low interest rates was a positive one.

"January is usually a good month for the market. So far we've trodden water, but I think next week will be a better week," he said.