By CARLO PIOVANO
LONDON (AP) â¿¿ Evidence that the U.S. economic recovery is firmly on track drove markets higher on Friday, adding to the cheer from good economic indicators out of Europe.
The world's largest economy added 157,000 jobs in January, in line with market expectations, though hiring over the past two years was revised up. The improvement was not sufficient to prevent the unemployment rate â¿¿ which is based on surveys of households, not employers â¿¿ from edging up to 7.9 percent from 7.8 percent in December.
But the figure eased concerns that the U.S. economic recovery may have been running out of steam. Official data this week showed the economy contracted on an annualized basis in the fourth quarter for the first time in three years, though mainly due to a one-off fall in defense spending.Other indicators released Friday proved similarly upbeat â¿¿ a measure of manufacturing activity in the U.S. rose strongly in January while construction spending grew in December. In Europe, Germany's DAX rose 0.7 percent to close at 7,833.39 while France's CAC-40 added 1.1 percent to 3,773.53. Britain's FTSE 100 rose 1.1 percent to 6,347.24. Wall Street rallied as well, with the Dow rising 1 percent to 13,999.08, trading momentarily above 14,000 for the first time since October 2007. The broader S&P 500 added 1 percent to 1,512.31. Although the Dow Jones industrial average finished lower on Thursday, the index logged its best January since 1994 by finishing 5.8 percent higher for the month. The Standard & Poor's 500 finished the month 5 percent higher, its best start to the year since 1997. Earlier, upbeat news in Europe had helped push markets higher. Official figures showed the unemployment rate in the 17-country eurozone was at a lower-than-expected 11.7 percent in December, unchanged from the previous month's rate, which was revised down from 11.8 percent, a record high. Inflation was also steady, suggesting the recession ravaging the currency union is it abating.