European stocks pared early losses and turned positive on Friday morning, halting a sharp three-day retreat, led by gains in Italy's blue-chip index.
Sentiment in the broader market remained cautious, however, with many traders preferring to wait on the sidelines until after a key speech by Federal Reserve Chairman Ben Bernanke later in the day on monetary policy.
After helping contribute to a solid rally over the summer months, European shares have retreated in recent days as expectations of imminent stimulus from the Fed eased.
At 0735 GMT, the FTSEurofirst 300 index of top European shares was up 0.1 percent at 1,078.70 points, after falling to a four-week low at the open.
Italy's FTSE MIB index was up 0.5 percent, reversing recent losses, with Enel up 0.9 percent and Intesa SanPaolo up 1.3 percent.