European stocks extend gains on Chinese, US data

Europe's main stock markets rose further on Friday, with traders reacting to positive Chinese economic trade data and an upbeat US jobs report, analysts said.

London's FTSE 100 index of leading companies climbed 0.69 percent to finish the week at 6,483.58 points, while Frankfurt's DAX 30 won 0.59 percent to 7,986.47 points, close to a five-year high.

In Paris, the CAC 40 jumped by 1.22 percent to 3,840.15 points.

The euro fell to $1.2990 from $1.3107 late on Thursday in New York.

Gold prices edged up to $1,581.75 an ounce on the London Bullion Market from $1,579.50 Thursday.

In New York, US stocks also gained in midday trades after a surprisingly strong jobs report suggested the economic recovery was on track.

The Dow Jones Industrial average was up by 0.35 percent after surging briefly to a new intra-day record of 14,413.17, while the broad-based S&P 500 added 0.26 percent and the tech-rich Nasdaq Composite Index rose by 0.24 percent.

The US jobs market brightened better than expected in February, with the unemployment rate falling and solid job growth, official data showed.

The jobless rate fell to 7.7 percent, from 7.9 percent in January, and the US gained a net 236,000 jobs, the Labor Department said.

"It’s another day with markets visibly up in the green territory, which seems pretty much standard now," commented Anita Paluch, a trader at Gekko Global Markets.

"Markets are in the risk mood, clearly inspired by the Asian markets' performance and boosted by the Chinese export numbers that increased dramatically."

Official data showed China's exports surged more than 20 percent in February year-on-year despite the Lunar New Year holiday, in another sign of recovery for the world's second-largest economy.

European stock markets had already posted sharp gains on Thursday after the ECB and Bank of England held their key rates, while forgoing any new stimulus measures as policymakers took stock of what appears to be an improving global economic climate.

"Although the US is facing some headwinds on the fiscal level due to spending cuts, recent hard economic data points to an improvement in the economic conditions and swelling hopes for solid recovery" in the world's biggest economy, Paluch said.

President Barack Obama last week reluctantly ordered an $85-billion austerity drive that could slow the US economy and slash jobs.

Asian stock markets meanwhile ended with gains on Friday, with Tokyo hitting the highest level since the collapse of Lehman Brothers in 2008, following another record-breaking finish for Wall Street's Dow Jones index overnight.

The Japanese currency fell to a three-and-a-half-year low against the dollar and also sank against the euro as investors look to the Bank of Japan's next policy meeting, on expectations of a further loosening of monetary policy, traders said.

Tokyo closed up 2.64 percent at 12,283.62 points, the highest level since the collapse of Wall Street banking giant Lehman Brothers in September 2008, while Shanghai added a modest 0.10 percent.

Back in Europe on Thursday, the ECB held its main refinancing rate at a historic low of 0.75 percent despite concerns that political gridlock in Italy could trigger a resurgence in the debt crisis.

European Central Bank chief Mario Draghi said he believed that with the current rate, an unprecedented amount of liquidity pumped into banks and a key bond-purchase programme in place, the central bank has already done a lot to help resolve the long-running eurozone debt crisis.

The Bank of England meanwhile voted to hold its reference interest rate at a record-low 0.50 percent, where it has stood for four years, and opted against increasing its cash stimulus programme.