UPDATE 1-Good earnings keep European shares at highs

* STOXX 600 up 0.2 pct

* Renault gains after update

* BHP up, BP down after shale deal(Adds details, updates prices)

By Danilo Masoni

MILAN, July 27 (Reuters) - European stocks inched up inmorning trading on Friday and were set to end the week atsix-week highs, helped by an easing of fears over U.S tariffsand good company results.

Shares in consumer goods company Reckitt Benckiser,construction groups Saint Gobain and Vinci,BT and bank BBVA rose following well-receivedresults, lifting the pan-European STOXX 600 benchmarkup 0.17 percent by 0856 GMT.

"On average earnings updates are quite good," said JeromeSchupp, fund manager at Geneva-based investment firm PrimePartners. "The message about the second half is also reassuringgiven the uncertainties regarding trade wars".

According to Deutsche Bank, European second-quarter EPSgrowth has accelerated to 6 percent from 0 percent in the first,a result they said was good given the deterioration in euro areagrowth momentum seen in the period.

Hopes of a breakthrough in U.S.-EU trade talks lifted theSTOXX to its highest level since mid-June on Thursday ascarmakers, which rely on exports for growth, rose sharply. Theindex was on track to end the week up 1.4 percent.

Investors however kept a degree of caution.

The U.S. Commerce Department will continue its probe intowhether auto imports pose a national security risk despiteongoing trade talks with the EU, but U.S. President Donald Trumpasked that no action be taken at this time, Commerce SecretaryWilbur Ross said on Thursday.

Autos were little changed Friday.

Renault rose 1.4 percent after a volatile start asthe French carmaker achieved record profitability in the firsthalf as emerging market sales surged.

"Results came in line with a modest headline beat and betternet liquidity but details of margin development and capitalintensity are mixed and likely to keep pressure on margins,"Jefferies analysts said in a note.

Shares in German carmakers BMW and Daimler, which are heavily exposed to the U.S. market,however slipped slightly.

Mining company BHP Billiton rose 3.7 percent afterBP agreed to buy its U.S. shale oil and gas assets for$10.5 billion. BP shares fell 1 percent.

"The shale deal presents a promising opportunity for BP toreverse many years of underinvestment," said Accendo MarketsArtjom analyst Artjom Hatsaturjants.

"Still, it comes at a price of a short-term hit toshareholder value and would divide those investors looking for aquick profit from rising oil prices and those who see along-term opportunity in holding Energy stocks," he added.(Reporting by Danilo Masoni; Editing by Kevin Liffey and AngusMacSwan)