* FTSEurofirst 300 index up 0.1
* Banks recover from early falls
* Oils weigh; Royal Dutch Shell down
* U.S. GDP data awaited
By Joanne Frearson
LONDON, Oct 29 (Reuters) - European shares edged higher on Thursday morning, with a recovery from banks outweighing falls in energy stocks after results from oil major Shell clouded the outlook for the sector.
By 0927 GMT, the pan-European FTSEurofirst 300 index of top shares was up 0.1 percent at 981.48 points after falling to a low of 974.50, its lowest level in three weeks.
The benchmark index, which has gained 52 percent since reaching a record low in early March is still down around 40 percent since its mid-2007 peak.
"European markets have been hovering either side of the starting point. Everything is pretty much on hold in front of the U.S. third-quarter GDP data," said Jim Wood-Smith, head of research at Williams de Broe.
U.S. third quarter gross domestic product figures are out at 1230 GMT and will be closely watched by investors for insight into the state of the world's biggest economy.
"It is not healthy that all global asset classes appear to be hanging on for one apparently key data item from the U.S. It is indicative of a market that is beginning to run out of ideas," Wood-Smith said.
Banks reversed earlier losses and added the most points to the index. KBC jumped 10.8 percent after sharp falls in the previous session.
HSBC, BNP Paribas, Standard Chartered and Societe Generale were 0.5 to 2.4 percent higher.
MINERS REGAIN GROUND
Miners rallied as copper prices edged 0.2 percent higher. Anglo American, Antofagasta, BHP Billiton and Rio Tinto were up 0.5 to 1.5 percent.
Henkel, the maker of Schwarzkopf hair products and Pattex glues, gained 4.7 percent after it surprised markets late on Wednesday in reporting preliminary quarterly results that it said were ahead of analysts' estimates. On the downside, energy stocks featured among the biggest losers as oil fell towards $77 a barrel.
Royal Dutch Shell slipped 2.7 percent after it said third-quarter net profit fell 73 percent and Chief Executive Peter Voser warned of a slow recovery.
Italian oil and gas group Eni was down 3.3 percent after it cut its full-year output forecast and said third-quarter adjusted net profit fell 60.5 percent on lower oil prices and refining margins. BG Group, Premier Oil and Total were down 1.2 to 1.5 percent.
Industrial engineering stocks weighed. Swiss engineering group ABB AG fell 4.5 percent after it said it is still struggling to predict when its customers will start spending again after third-quarter orders slumped 21 percent.
Across Europe, the FTSE 100 index was down 0.05 percent, Germany's DAX was flat and France's CAC 40 was up 0.03 percent. (Editing by David Holmes)