US jobs data boosts European shares

European shares hit its highest close in just over three weeks on Friday after strong US jobs data supported the view the global recovery was on track, while technicals also pointed to a more bullish trend. The pan-European FTSEurofirst 300 index of top shares closed up 1.5 percent at 1,141.40 points. Prospects for technicals brightened after the euro zone's blue chip Euro STOXX 50 index moved above its 50-day moving average, but fund managers were still said to be stock selective.
"US non-farm payroll (jobs) data seems to be continuing in the right direction and the unemployment rate is coming down," Veronika Pechlaner, an investment manager on the 100 million euro ($141.5 million) Ashburton European equity fund. Financial stocks featured among the top performers after fund managers said the announcement by Dublin's finance minister that it would be unwise to impose losses on senior bondholders at banks was being taken by the market as positive.
The Irish bank stress tests showed Ireland would need up to 24 billion euros more to recapitalise the financial system, which was in line with expectations. Buyers came for Bank of Ireland up 38.6 percent at 31 euro cents and Allied Irish was 8.3 percent higher at 21 cents.
UK banks and insurers performed well on the back of the news, Barclays and Prudential gaining 4.3 percent and 3.4 percent respectively after falls on Thursday. However, Irish Life & Permanent fell 58 percent after its banking arm is expected to face state control following plans to sell off its life business via an IPO.
Stock markets in the periphery euro zone countries gained. Ireland's ISEQ rose 2.3 percent, Spain's IBEX 35 gained 1.5 percent, Portugal's PSI 20 was up 1.4 percent and Italy's benchmark rose 1.1 percent. In core Europe, Germany's DAX was 2 percent higher and France's CAC 40 was up 1.6 percent.
Insurer Swiss Re gained 3.6 percent on talk of a stake increase by US investor Berkshire Hathaway, while stock exchanges themselves were also in the spotlight. Deutsche Boerse fell 1.4 percent after Nasdaq OMX and IntercontinentalExchange unveiled a rival bid for NYSE Euronext which was 27 percent above the company's valuation before the Frankfurt stock market operator made its agreed bid in February.