UPDATE 1-Festive European markets notch another record high

Sagarika Jaisinghani and Lisa Pauline Mattackal

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* China's industrial profits log best month in eight

* Beijing in close contact with Washington on trade pact

* Export-heavy German shares lead advancers

* Defensives lag as risk appetite increases

* Qiagen tumbles after deciding against sale (Adds comments, details; updates prices)

Dec 27 (Reuters) - European shares rose to another record high on Friday, on course for their best year since the global financial crisis as investors remained optimistic about an improving global economy after a fresh dose of upbeat economic data from China.

The pan-European STOXX 600 index was up 0.3%, led by gains in export-heavy German shares. The benchmark index has now hit record highs for three consecutive sessions in a holiday-shortened week.

The index is also set to round off its third straight week of gains, with firming indications of a preliminary U.S.-China trade deal and hopes of a smoother Brexit lifting sentiment in the final month of the year.

"In 2020, we see a higher level of confidence about (the trade deal and Brexit)," said Chris Bailey, European strategist at Raymond James.

"Markets, as always, need a surprise to the upside. To get that, you're going to need to see a Phase 1 deal signed, and some positive comments continuing around trade."

Beijing said this week it was in close contact with Washington about their initial agreement, shortly after U.S. President Donald Trump talked up a formal signing ceremony. The deal is widely expected to be signed in early January.

The comments have led to expectations of a rebound in global growth in 2020, with relatively loose monetary policy and robust economic data from the world's biggest economies also giving traders a reason to cheer the advent of the new decade.

Data on Friday showed profits at China's industrial firms rose at the fastest pace in eight months in November.

Trade-sensitive European miners jumped 1.3%, on track for their best day in nearly two weeks. Oil and gas firms also rose, tracking higher commodity prices.

Food & beverage, telecom and healthcare stocks were among the underperformers of the day, indicating a bigger risk appetite.

Still, with no major updates expected this year either on the trade front or on future Brexit negotiations, volumes are expected to remain light until the first full week of January.

Investors will also look to fourth-quarter corporate financial results due next month for clues on companies' outlook on growth next year.

In a light day for corporate news, Qiagen shares tumbled 19.2% after the genetic testing firm decided against selling the company. The stock was the biggest drag on the STOXX 600.

(Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Saumyadeb Chakrabarty and Hugh Lawson)