After being in negative territory all day, leading shares are moving higher after much better than expected US jobs figures.
The non-farm payroll numbers showed 11,000 jobs were lost in November, an almost unbelievable figure when you consider that the average expectation was for a drop of around 130,000 and even the most optimistic were going for a 100,000 decline. So either it's a blip (possible), the economists are incapable of forecasting correctly (also possible) or the US economy is recovering much more quickly than expected (hmmm). Rob Carnell at ING Bank - as one of the forecasters - was hesitant to get too carried away:
The only potential fly in the ointment of this labour report is how believable it is. Payrolls has been making very, very slow progress in recent months, and such a dramatic turnaround will raise eyebrows, and may not be taken at face value by many. An improvement in the payrolls series always looked on the cards from last month. But most of the labour market data in the run up to this release had been consistent only with a very small step forward, so we may need to see this backed up again next month before concern about the labour market can really be filed away as "last year's worries".
The overall takeaway from this employment report is a remarkable turnaround in the fate of the US labour market, so remarkable in fact that we may take another month or two to fully believe it, if backed up by other data. But for now, markets cannot be blamed for switching fully back to "risk on", so bad news for bonds and great news for the equity market.
So whatever the reality, the FTSE 100 - which was down around 27 points immediately before the figures were released - is now 33.50 points higher at 5346.50 and still climbing.
The US futures - which were showing an opening rise of around 25 points - jumped to a prediction of a 111 point increase following the figures.
