Bourses gain as US jobs data fuel rate hopes

Stock markets across Europe cheered the US jobs data which provided further hope that the need for more further interest rate rises is diminishing.

Shares in Paris gained 1.7 per cent with technology stocks leading the way as the Nasdaq strengthened. The CAC 40 index added 112 to 6,565.97.

Chipmaker STMicroelectronics, the main victim of Wednesdays sell-off, led the CAC winners, rising 5.6 per cent to €66.50. Telecom operator Bouygues rose 5 per cent to €75.50, Cap Gemini added 4.4 per cent to €189.30 and telecoms equipment maker Alcatel rose 3.4 per cent to €74.40.

Heavyweight France Telecom rose 3.6 per cent to €151 on hopes that its subsidiary Dutchtone would get a Dutch third-generation mobile phone licence more cheaply than previously expected.

Frankfurt nudged higher, pulled up by gains in Deutsche Telekom and Daimler Chrysler and at 5.30pm, the Xetra DAX index was 82.22 higher at 7,033.31.

Deutsche Telekom surged €2.35 to €60.80 as a number of investment banks suggested that the cost of third-generation UMTS licences might not be as high as originally thought.

DaimlerChrysler gained €1.22 to €56.72 on reports that the IPO for the EADS European aerospace consortium had been oversubscribed for both the institutional and retail tranches.

Banks remained in focus amid continuing speculation over sector consolidation.

Commerzbank was 50 cents higher at €38.70 and Dresdner Bank picked up 75 cents to €42.50 amid reports that executives would hold talks this weekend but were unlikely to draft merger plans in time for a regular Commerzbank supervisory board meeting on Monday.