Europe shares extend gains on Microsoft-Yahoo news

FRANKFURT, Feb 1 (Reuters) - European shares extended gains by midday on Friday after news of Mirosoft's (MSFT.O) proposal to acquire Yahoo (YHOO.O) in a $44.6 billion cash and stock deal.

By 1150 GMT the FTSEurofirst 300 index .FTEU3 of top European shares was up 1.9 percent at 1,354.71 points.

"Investors are throwing themselves in after positive news that gives them a reason to buy equities," one trader said, commenting on the Microsoft-Yahoo announcement. [ID:nWNAS8942]

The DJ Stoxx index of European technology shares .SX8P rose 2.1 percent.

Miner Rio Tinto (RIO.L) was the top gainer, up 14.5 percent, after Chinese aluminium producer Chinalco said it had bought a 12 percent stake in the company jointly with U.S. producer Alcoa (AA.N).

The DJ Stoxx basic resources index .SXPP, which includes miners, was up 8.4 percent. Rio suitor BHP Billiton (BLT.L) rose 12 percent and Anglo American (AAL.L) was up 7.2 percent.

French bank Societe Generale (SOGN.PA) rose 5.2 percent after a report that local rival Credit Agricole (CAGR.PA) had hired advisors to consider a possible takeover approach. Shares in Credit Agricole, which declined to comment, rose 0.5 percent. (Reporting by Peter Starck)