UPDATE 3-D.Telekom defers 2010 outlook,too much uncertainty

* Will give 2010 outlook in Feb, confirms 2009 targets

* To propose dividend, detail more cuts in Feb

* Core profit above expectations

* Says free cash flow at 3.3 bln eur in Q3

* Shares up 2.8 pct vs 0.5 pct drop of DAX index (Recasts, adds CEO comment, analyst comment, updates shares)

By Nicola Leske

BONN, Nov 5 (Reuters) - Deutsche Telekom (DTEGn.DE) shied away from forecasts for 2010, citing economic uncertainty on both sides of the Atlantic, but costs controls helped it beat forecasts for quarterly core profit.

Chief Executive Rene Obermann said doubts about recovery in Eastern Europe and the impact of an expected rise in unemployment in Germany -- its biggest market -- as well as a challenging U.S. market made for poor visibility.

"We are looking very carefully and with caution when it comes to 2010," Chief Executive Rene Obermann said on Thursday.

"We will provide guidance together with our full-year results in February," Obermann said, adding the company would at that time also disclose details about further cost saving measures and its dividend proposal.

For the past two years it has paid out 0.78 euros per share.

Deutsche Telekom shares were up 2.75 percent at 9.54 euros by 1209 GMT, making it the second biggest gainer on Germany's blue chip index .DAX, which was down 0.4 percent.

The group rattled investors with a profit warning in April and some analysts expressed doubt the company would be able to reach its cash flow target.

But Deutsche Telekom reassured with third-quarter free cash flow of 3.3 billion euros ($4.90 billion), which will allow it to reach its full-year target of 6.4 billion euros.

The company also confirmed its sees adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) 2-4 percent lower than the 19.5 billion euros it made in 2008.

"The key figures look pleasant and there should be some relief that the dividend is probably not in danger as free cash flow was much better than expected," Merck Finck said in a note.