European Shares Rise as Investors Take Positives From U.S. Data

  • Miners surge sixth day on commodity prices, China speculation
  • U.S. payrolls rise 242,000 but wages unexpectedly decline

European stocks advanced as investors focused on some better-than-expected U.S. payroll data, while also speculating on possible further stimulus from China.

A gauge of commodity producers posted the best performance of the 19 industry groups on the Stoxx Europe 600 Index, advancing for a sixth day, with Anglo American Plc and Glencore Plc jumping more than 11 percent as raw-materials prices increased. Energy companies rose for a seventh day as oil headed for its longest run of weekly gains since May.

The Stoxx 600 added 0.7 percent to 341.8 at the close of trading. The equity benchmark rose as much as 1.3 percent after a Labor Department report showed U.S. payrolls expanded more in February than forecast, while wages unexpectedly declined. It subsequently gave up all gains before rebounding in late afternoon trade. The index posted a third weekly gain, its longest streak since October. It has recovered 13 percent from a Feb. 11 low, boosted by banks, commodity and energy shares.

“The numbers show the U.S. economy is still growing and should help bring back a positive mood,” said Benno Galliker, a trader at Luzerner Kantonalbank AG. “These are really good numbers -- maybe they were even too good. If they’re too good, the interest rate hike comes back into play, but for the moment the numbers are positive and should speak well to the market.”

U.S. nonfarm payrolls expanded 242,000 in February, following a 172,000 rise in January that was larger than previously estimated. The jobless rate held at 4.9 percent as people entered the labor force and found work. Still, average hourly earnings dropped, the first monthly decline in more than a year.

Federal Reserve officials gather for their next two-day meeting on March 15, with traders pricing in a less than one-in-10 chance the central bank will increase rates this month. The probability rises to 42 percent by mid-year, while odds for a December move are about 69 percent.

The European Central Bank is scheduled to announced its next interest rate decision on March 10. In January, President Mario Draghi signaled the central bank may add further stimulus as soon as this month.

Industrial metals advanced on optimism that China will unveil plans to revive growth when an annual meeting of the National People’s Congress gets under way on Saturday.

Among stocks active today, Seadrill Ltd. soared a record 39 percent as investors covered short bets after the indebted offshore driller’s main owner, billionaire John Fredriksen, this week raised $510 million in cash, fueling speculation of a bailout.

Andritz AG climbed 5 percent to its highest price this year after the Austrian industrial supplier announced better-than-estimated fourth-quarter sales and profit. Gemalto NV jumped 9.1 percent after the world’s largest provider of high-security mobile-phone and bank-card chips posted higher-than-estimated full-year revenue.

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