Europe’s main stock markets leapt higher yesterday, boosted by a surprise drop in the US unemployment rate and on the back of upbeat comments from European Central Bank chief Mario Draghi.

At the close, London’s FTSE 100 index of leading companies was 0.74 per cent higher at 5,871.02 points. In Frankfurt, the Dax 30 rose by 1.27 per cent to 7,397.87 points, while in Paris the CAC 40 jumped by 1.64 per cent to 3,457.04 points.

Madrid’s IBEX 35 index increased by 1.81 per cent to 7,954.40 points despite lingering concern over a pot­ential bailout of debt-ridden Spain.

“The US jobless figures were the catalyst for the rise on markets. These figures show us that the situation in the United States isn’t that bad,” said Alexandre Baradez, analyst at Saxo Bank in Paris.

Wall Street also gained on the solid September US jobs data that, after revisions to previous months, pulled the unemployment level down to 7.8 per cent, the lowest since January 2009.

In midday trading, the Dow Jones Industrial Average rose 0.37 per cent, the S&P 500 gained 0.43 per cent and the tech-rich Nasdaq Composite moved up 0.15 per cent.

The Labour Department data for September showed a poor 114,000 net new jobs produced, but previous months were revised higher and, when combined with a rise in labor market dropouts, the official rate fell from the previous 8.1 per cent.

“While the media may be concentrating on the fact that payroll levels deteriorated in September, the underlying trends in the data were extremely positive,” said Briefing.com.

The euro rose to $1.3055 from $1.3018 late in New York on Thursday, and hit $1.3072 during the session – the highest level since September 19 –after Draghi reassured dealers over the ECB’s bond-buying scheme.

“Today all eyes are on the mother of all data publications, the US labour market report,” said Commerzbank analyst Antje Praefcke.

In September, the Fed unveiled a $40-billion-per-month bond-buying scheme it said would remain in place until it sees substantial improvement in the US jobs market.

Asian equities meanwhile rose on Friday following Draghi’s latest comments.

Hong Kong won 0.50 per cent, Tokyo closed up 0.44 per cent, Sydney rose 0.94 per cent and Seoul climbed 0.12 per cent. Shanghai was closed for a public holiday.

In India, mistakes by a local brokerage in placing orders worth $125 million briefly crashed the National Stock Exchange, leading to a 15.5 per cent fall in the main index and a suspension of trading.

In Europe, Draghi said Thursday that an ECB backstop to help under-pressure eurozone economies by buying their debt to keep borrowing costs low was in place and ready for use.

But he stressed it was up to governments to act and get their economies and finances in order to end the eurozone’s deep woes, and praised Spain for “remarkable” progress in passing reforms of its labour market and banks.

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