* FTSEurofirst 300 up 0.9 pct, Euro STOXX 50 up 1.4 pct
* Euro STOXX 50 posts biggest weekly gain since Nov
* Valuation ratios getting pricey -BNP Paribas IP
* Fitch downgrades Italy after Europe's closing bell
By Blaise Robinson
PARIS, March 8 (Reuters) - European shares hit their highest level in 4-1/2 years on Friday after robust U.S. jobs data fuelled expectations of a pick-up in global growth while central banks' keep policy supportive.
The FTSEurofirst 300 index of top European shares closed 0.9 percent higher at 1,195.20 points, after rising as high as 1,197.73 following the U.S. data, a level not seen since September 2008.
The euro zone's blue-chip Euro STOXX 50 index added 1.4 percent to 2,728.78 points, posting a weekly gain of 4.3 percent, its biggest weekly rise in nearly four months.
"We're seeing growing inflows coming into the asset class. This is sort of a sweet spot, with improving U.S. job data while central banks around the world are pledging to keep printing money," said David Thebault, head of quantitative sales trading at Global Equities in Paris.
The U.S. data showed employers added 236,000 workers to their payrolls last month, much more than the forecast of 160,000 jobs economists had expected, while the jobless rate fell to 7.7 percent, the lowest rate since December 2008.
The figures, however, were not enough to spur concerns that the U.S. Federal Reserve could call a halt to bold measures to support the economy, such as its programme of bond-buying, or begin to raise ultra-low interest rates anytime soon.
"Any number above 200,000 shows that the U.S. is on a strong growth path. And it's too early for markets to be worrying about quantitative easing being wound down," James Butterfill, global equity strategist at Coutts, said.
"I don't think it's really going to change the Fed's accommodative stance at this point. An unemployment rate falling to 7.7 percent from 7.9 is a step in the right direction, but with the Fed looking at 6.5 percent, I think it will need to get down to 7 percent for there to be growing pressure to adopt a more hawkish stance."
The broad rally following the data prompted some investors to seek out areas of relative value in Southern Europe, which had suffered again recently from a resurgence of political risks.
Italy's FTSE MIB benchmark index and Spain's IBEX chalked up the biggest gains, surging 1.6 percent and 2.9 percent, respectively, led by leading banks and telecoms such as Telefonica and UniCredit, up 4.2 percent and 2.8 percent.
European banking shares also featured among the biggest gainers, with France's BNP Paribas adding 4.1 percent, and Raiffeisen Bank gaining 2.6 percent.
The lofty gains in Southern Europe could be short lived, however, after a credit rating downgrade of Italy by Fitch after Europe's closing bell.
Worries over the debt-stricken country, where elections last week left no party grouping with enough support to form a durable government, prompted a substantial but short-lived correction to this year's bull run at the end of February.
Around Europe, UK's FTSE 100 index added 0.7 percent, Germany's DAX index gained 0.6 percent, and France's CAC 40 climbed 1.2 percent.
Wall Street's Dow Jones industrial average hit an all-time high this week while both the DAX and FTSE 100 passed peaks last seen at the time of the 2008 financial crisis.
The question many analysts are asking, however, is whether the boom is due largely to the flow of cheap money from major central banks rather than any more durable recovery in the economy and business.
"Some valuation ratios are getting a bit excessive, although we're not yet at a stage where equities are overvalued," said Joost van Leenders, strategist at BNP Paribas Investment Partners, which has 503 billion euros ($653 billion) in assets under management.
"U.S. and the UK stocks are getting expensive, especially when you look at the macro fundamentals, while the euro zone is probably the only region where you still see relatively cheap valuation."
The Euro STOXX 50 index trades at 10.3 times earnings expected in the next 12 months, compared with a price-to-earnings ratio of 13.4 for Wall Street's S&P 500 , according to Thomson Reuters Datastream.