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European share prices keep advancing as US recessionary fears start to fade

European stock exchanges advanced on Friday for the third straight day as investors took heart from US job creation figures suggesting there was still some punch left in the US economy.

The London FTSE 100 index rose 0.28 percent to close at 6,245.20 points, while in Paris the CAC 40 gained 0.25 percent to 5,537.84. In Frankfurt the DAX inched up 0.05 percent to end the day at 6,716.52. The Euro STOXX 50 index of leading eurozone shares added 0.22 percent to end the week at 4,091.67.

On the currency market the US dollar firmed against the euro on the US employment figure as well as a better-than-expected report on the US trade deficit.

Wall Street shares were higher on Friday morning as investors generally welcomed the latest economic readings on the nation's job growth and a narrowing of the trade deficit.

Traders said that separate reports, showing that non-farm job growth increased in line with expectations and that the US trade deficit had narrowed to US$59.1 billion, had helped stave off recessionary fears.

"The stock market got very good news this morning. The recession has again been postponed," said Dick Green, a president at Briefing.com.

"February nonfarm payrolls rose 97,000. That isn't exactly booming, but it isn't weak either," Green said, referring to data which showed US employers added 97,000 jobs last month.

The nonfarm job numbers suggested the world's biggest economy is chugging along despite weakness in the housing and auto sectors, and offset fears that recessionary clouds could be gathering over the horizon.

Meanwhile, the US Commerce Department said the US trade deficit narrowed in January thanks to record-breaking export growth, but cheap Chinese goods still flooded US malls. The shortfall fell from the revised December figure of US$61.5 billion.

In London pharmaceutical group Alliance Boots shot up 14.11 percent to ?9.30 after announcing it had been approached by a potential buyer, whose name was not disclosed.

In Paris European aerospace company EADS fell 4.60 percent to 22.60 euros after confirming that its aircraft unit Airbus suffered a first-ever operating loss last year and would likely show a loss next year as well.

But the media and defense group Lagardere, a key EADS shareholder, rose 1.96 percent to 58.93 points ahead of publication of its annual results tomorrow.

Engineering group Thales added 1.46 percent to close at 38.93 euros on better than expected 2006 results.

In Frankfurt automaker Volkswagen rose 3.05 percent to 103.05 euros after increasing its net earnings target for this year to at least 5.1 billion euros (US$6.7 billion) this year.

Elsewhere there were gains of 0.45 percent in Madrid and 0.27 percent in Amsterdam. There were declines of 0.04 percent in Milan and 21.83 points to 8,933.97 in Zurich.
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