June 6, 2014 / 7:42 PM / in 4 years

GLOBAL MARKETS-Shares rally after U.S. jobs data; bonds rise

* About 217,000 U.S. jobs created in May
    * European markets buoyed by ECB's action on Thursday
    * Yields on low-rated euro zone bonds hit record lows

 (Adds close of European markets)
    By Herbert Lash
    NEW YORK, June 6 (Reuters) - Global equity markets rose and
bond yields fell on Friday after a solid U.S. jobs report added
to evidence of a recovering economy and bolstered a market
already lifted by the European Central Bank's pledge to douse
deflation with bundles of cash.
    The Dow and S&P 500 extended a rally that has taken them to
repeated records since last week, while in Europe, peripheral
markets outperformed as investors bet that banks in the euro
zone would benefit the most from the ECB's measures.
    The nonfarm payrolls report showed U.S. employers maintained
a solid pace of hiring in May, returning employment to its
pre-crisis level. The economy has recouped the 8.7 million jobs
lost during the recession, adding just under 217,000 jobs in
May, while the unemployment rate held steady at 6.3 percent.
    "This number is not a surprise and should be a rallying cry
for the bulls," said Todd Schoenberger, managing partner at
Landcolt Capital in New York. "There's no shock on either side
of the tape, but it supports the historical norm of the second
quarter typically being the best of the year."
    Markets also were buoyed after the ECB on Thursday cut
interest rates, including taking deposit rates for banks below
zero, and pledged hundreds of billions more euros in cheap funds
for banks. 
    MSCI's all-country stock index rose 0.53
percent. The FTSEurofirst 300 index of top European
shares rose 0.6 percent to close at 1,388.48. 
    The Dow Jones industrial average rose 72.55 points,
or 0.43 percent, at 16,908.66. The Standard & Poor's 500 Index
 was up 7.22 points, or 0.37 percent, at 1,947.68. The
Nasdaq Composite Index was up 21.23 points, or 0.49
percent, at 4,317.45. 
    U.S. Treasuries prices gained and German bund futures
 hit session highs of 145.99 after the U.S. jobs data,
up 98 ticks on the day. 
    Benchmark 10-year Treasuries retreated, down
4/32 in price to yield 2.5986 percent.
    The U.S. dollar recouped losses as investors added to a
well-worn pattern of borrowing greenbacks to buy higher-yielding
currencies after the solid U.S. jobs data left few chances the
Federal Reserve would speed up monetary tightening.
    The euro gyrated after the data, initially selling
off but then rising briefly to a two-week high of $1.3677. It
settled back to $1.3638, down 0.15 percent.
    U.S. crude oil futures rose as the U.S. jobs report bodes
well for future oil demand.
    Brent fell 18 cents to $108.61 a barrel. U.S. crude
 rose 18 cents to settle at $102.66 a barrel.

 (Reporting by Herbert Lash; Editing by Meredith Mazzilli,
Leslie Adler and Dan Grebler)
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