World stocks gain on U.S. jobs data; euro up

Fri Dec 2, 2011 10:53am EST
 
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NEW YORK (Reuters) - World stocks rose on Friday and were on track for their biggest weekly gain since November 2008 as U.S. data showed a drop in the jobless rate, while the euro gained for a fifth consecutive session.

The U.S. jobs data supported views that the U.S. economy would avoid another recession.

Speculation that the European Central Bank may lend to weak euro zone countries through the International Monetary Fund helped the euro.

Markets have posted strong gains after central bank moves earlier this week cut funding costs for banks. Signs that euro zone policymakers are working hard to resolve a compromise deal ahead of a December 9 summit, viewed as make-or-break for the 12-year old single currency bloc, also lent support.

World stocks on the MSCI all-country index .MIWD00000PUS were up 0.8 percent. The index is up 8.7 percent so far this week.

U.S. stocks opened higher. The Dow Jones industrial average .DJI was up 94.87 points, or 0.79 percent, at 12,114.90. The Standard & Poor's 500 Index .SPX was up 11.01 points, or 0.88 percent, at 1,255.59. The Nasdaq Composite Index .IXIC was up 24.97 points, or 0.95 percent, at 2,651.17.

The government said the economy created 120,000 jobs last month, while the jobless rate dropped to a 2-1/2 year low of 8.6 percent, further evidence the economic recovery was gaining momentum.

"Overall this an encouraging report on the labor market," said David Resler, chief economist at Nomura Securities in New York. "But we shouldn't get too excited that we're going to see four-tenths of a percent decline in the unemployment rate very often."

In currency markets, the euro was last up 0.3 percent at $1.35024. It hit a high of $1.35505 on electronic trading platform EBS immediately after the U.S. payrolls data, the currency's highest since November 22.   Continued...