Global stocks recoup early losses

Published: 11/7/2009 4:17:53 AM

By Maktoob Business

NEW YORK - Global equity markets rebounded on Friday from the initial scare brought on by a grim U.S. jobs report after investors decided the data were not so bad.

While U.S. President Barack Obama called the data "sobering", the increase in the unemployment rate to a higher-than-expected 10.2 percent, a 26-1/2-year peak, was later discounted after the number of jobs reported lost in August and September were revised down.

U.S. employers cut 190,000 jobs last month. Economists polled ahead of the data had expected 175,000 job cuts and an unemployment rate of 9.9 percent.

"The real shocker is the unemployment rate," said Joseph Trevisani, senior market analyst at FX Solutions in Saddle River, New Jersey. "The Fed will stay on hold even longer with less likelihood of giving a concrete answer as to when and how to withdraw quantitative easing."

Helping to overshadow the jobs report were two analyst upgrades on shares of U.S. conglomerate General Electric, a bellwether for U.S. economic activity. This helped take some of the sting out of the stock market's initial fall on the jobs report. GE's share price surged 7 percent to $15.44.

"The headline (U.S.) numbers look terrible, but for traders and investors looking for trends, a closer look at the report shows that there is a trend of slowed job losses," said Randy Frederick, director of trading and derivatives at Charles Schwab & Co, Inc in San Francisco.

European share prices also managed to turn higher, with bank stocks leading the way. Part-nationalized Royal Bank of Scotland gained 5.3 percent after it said it more than halved third-quarter losses as impairments fell.

At 1 p.m. (1800 GMT), the major U.S. stock indexes were all higher. The Dow Jones industrial average was up 24.64 points, or 0.25 percent, at 10,030.60. The Standard & Poor's 500 Index rose 3.04 points, or 0.29 percent, at 1,069.67. The Nasdaq Composite Index gained 6.56 points, or 0.31 percent, at 2,111.88.

The MSCI world equity index rose 0.36 percent while the emerging markets index gained 0.75 percent.

European stocks recovered early losses as the FTSEurofirst 300 index gained 0.2 percent, up 1.6 percent for the week. Tokyo's benchmark Nikkei rose 0.74 percent to 9,789.35 on Friday after marking a one-month closing low on Thursday. The Nikkei lost 2.44 percent for the week.

Page 1 of 1