Buoyant US economy boosts shares

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The Independent Online
THE US economy defied all expectations of a steady slowdown when key figures yesterday revealed a staggering jump of 378,000 in the number of new jobs last month, writes Diane Coyle. The unemployment rate dipped back to its 30-year low of 4.3 per cent.

The surprising buoyancy helped share prices climb further. By mid-morning the Dow Jones index was up nearly 55 points at 9,592.35. The dollar gained against the euro and the yen. It reversed a dip below 110 yen on Thursday to climb above 112 yen.

In London the FTSE 100 index ended 46 points higher at 6,147.2, having briefly touched a new high of 6,195.6 during the day.

Even adjusting yesterday's US figures for a 104,000 boost to construction employment from unseasonably warm December weather, the rise in the non- farm payrolls total was well above analysts' expectations.

The news, following strong reports on the post-Christmas sales and the housing market earlier in the week, dimmed any remaining hopes for a further interest rate cut.