Wall Street’s Dow and S&P 500 closed at their highest points in nine months following a positive monthly job's report. Financials and tech stocks rallied, while the energy sector lagged.
In economic news, 247,000 jobs were lost in July, down from a revised 443,000 cut in the previous month. Economists forecast a loss of 325,000 jobs. It was also the lowest level of job cuts in 11 months.
Meanwhile, a report showed the unemployment rate dipped from 9.5% in June to 9.4%, the first decline since April 2008.
The Dow Jones gained 113.81 points, or 1.23%, to 9,370.07, the S&P 500 added 13.40 points, or 1.34%, to 1,010.48 and the NASDAQ put on 27.09 points, or 1.37%, to 2,000.25.
Financials were mostly higher following the better than expected jobs report. JPMorgan, Wells Fargo and Morgan Stanley gained 4%, 2.8% and 2.2% respectively.
Citigroup added 1.3%, while Goldman Sachs and Bank of America shed 1.9% and 1.7%.
American International Group surged 20.5% after reporting its first quarterly profit in almost two years. The insurer still owes $87.6 billion to taxpayers.
Freddie Mac sank 11.9% despite also reporting its first quarterly profit in two years on Friday. It was also the first time in four quarters the mortgage lender would not require financial assistance from the treasury.
Fannie Mae slumped 16.5%.
It was a positive day for the tech sector. IBM, Apple and Microsoft put on 1.7%, 1% and 0.5% respectively. Hewlett-Packard jumped 3.2%.
Google advanced 1.5%, while rival Yahoo! lost 0.8%.
Airline manufacturer Boeing rose 2.6%, while Lockheed Martin added 1.4%.
Automaker Ford dipped 0.7% as the senate approved a $2 billion extension to the 'Cash for Clunkers' program. This will give consumers $4,500 for buying fuel-efficient vehicles in place of their fuel guzzlers.
Energy stocks tracked the price of crude lower. Exxon Mobil and ConocoPhillips slid 0.4% and 0.1%. Chevron bucked the trend with a 0.4% gain.
NYMEX light crude oil for September delivery fell US$1.01 to settle at US$70.93 a barrel.
COMEX gold for December delivery fell US$3.40 to settle at US$959.50 an ounce.
European Markets
European investors were buoyed by the positive US jobs data, sending stocks higher. Telecom’s and financials were stronger, while the miners had a mixed day.
The UK benchmark FTSE 100 added 41.03, or 0.87% to 4,731.56. The German DAX put on 88.98, or 1.66% to 5,458.96, while the French CAC40 advanced 43.31, or 1.25% to 3,521.14.
Financials reversed early session losses to close higher. France’s Societe Generale and BNP Paribas climbed 5% and 3%, while Germany’s Deutsche Bank jumped 3.3%.
Barclays, HSBC and Standard Chartered gained 3.1%, 0.9% and 0.7%. UK peer Royal Bank of Scotland sank 12.1% after reporting a first half loss.
Lloyds lost 2.6%.
Oil producers BP, Royal Dutch Shell and BG Group rose 2.1%, 1.2% and 1.1% respectively. Total was flat.
Miners BHP Billiton and Antofagasta put on 1% and 0.9. Rio Tinto, Xstrata and Anglo American lost 3%, 1% and 0.7%.
Telecoms performed strongly. France Telecom, Deutsche Telekom and Vodafone put on 3.6%, 3.8% and 2.8% respectively.
Peugeot shed 5.4% after S&P cut the automakers debt rating. Renault lost 2%, while Volkswagen rose 3.7%.
Japanese Markets
Japans’s Nikkei closed at a 10-month high Friday after spending the majority of the day below the line. Better than expected earnings reports gave reason for optimism on a quiet day's trading.
The benchmark Nikkei 225 added 24.00 points, or 0.23% to 10,412.09.
Toray Industries climbed 7.3% after the fibreglass maker raised its operating forecasts for the first-half.
Sanyo Electric rose 4.7% on reports it would double solar-panel production at one of its factories.
Konica Minolta Holdings slumped 10.1% after the company fell into the red during the first quarter, prompting a broker downgrade.
Bridgestone slid 0.2% before reporting a loss for the second quarter after the close. However, the tyremaker increased its full-year outlook.
Oil and gas explorer AOC Holdings sank 11% after reversing its full year forecast from a profit to a loss.
Hong Kong Markets
Hong Kong slumped Friday, led by big declines from the banks and the shippers. Investors were concerned the central government would act to reign in liquidity in the market.
The Hang Seng slumped 523.87, or 2.51% to 20,375.37.
Bank of China retreated 2.7%, ICBC gave up 2.5%. HSBC, which makes up around 30% of the Hang Seng Index, lost 1.6%.
China Mobile bucked the trend, rising 1.7%.
Cosco Pacific sank 5.2%, while Orient Overseas slumped 7.6% after posting its first loss in a decade.
China Resources Power slipped 6.8% after UBS downgraded the stock.
In other stocks covered Manulife Financial Corp retreated 9.4% after slashing its dividend, while Gome Electrical Appliances Holdings retreated 7.8%.
