New York (AFP) - World stock markets rose Friday following a better-than-expected US jobs report and another rise in oil prices, as global equities continued to rally from a dismal start to 2016.
The Labor Department reported that the US added a robust 242,000 jobs in February, although the data also showed a drop in wages.
The jobs report came after better-than-expected US reports on private jobs, the manufacturing sector, construction spending and auto sales.
That helped to lift sentiment, along with stimulus measures by the Chinese government, rising oil prices and anticipation that the European Central Bank will enact monetary stimulus next week.
"US data continues to shine, oil continues to firm and risk appetite is coming back into all aspects of the markets," said analyst Angus Nicholson at traders IG.
"With some relative calm returning to the markets, battle-weary investors are finally starting to emerge from the shadows," said Mike McCudden, head of derivatives at online stockbroker Interactive Investor.
In the US, the S&P 500 gained 0.3 percent to finish at 1,999.99, just a hair below the psychologically-important 2,000 level. The Dow finished up 0.4 percent at 17,006.77, its first close above 17,000 since January 5.
- Another US rate hike? -
However, analysts said buying was constrained by worries that improving US economic data could boost the odds of a Federal Reserve interest rate hike. Analysts still see the move as unlikely in March, but said a hike could come soon after that.
"Conventional wisdom discounts the possibility of a raise in March, but if we continue to see employment improve as the months roll on, we may see the possibility of a Fed increase at its June meeting may come firmly back into play," Mark Vickery of Zacks said.
"While two weeks ago you would have been able to rule out a rate hike at the Fed meeting in (mid-March), I think given the data we've seen and the market performance, a potential further rate hike of 25 basis points in two weeks hasn't been completely ruled out," said Michael James, managing director for Wedbush Securities.
"And that's restraining some optimism to the upside right now."
Earlier, London rose 1.1 percent, while Paris tacked on 0.9 percent and Frankfurt 0.7 percent. Japan's Nikkei climbed 0.3 percent.
Commodities and oil-linked stocks were particularly strong, with the strong US jobs data lifting hopes of a pickup in petroleum demand.
London-listed BHP Billiton surged 9.2 percent, US midsized oil company Marathon Oil jumped 10.3 percent and German steel company ThyssenKrupp advanced 3.1 percent.
In Japan, energy explored Inpex surged 6.8 percent, while JX Holdings advanced 1.9 percent.
Markets are also keeping watch on events in Beijing where the National People's Congress opens Saturday with delegates to sign off on a new five-year economic plan.
The meeting comes after China on Monday cut the amount banks have to hold in reserve -- aimed at stirring lending and growth in the wider economy.
- Key figures around 2200 GMT -
New York - Dow: UP 0.4 percent at 17,006.77 (close)
New York - S&P 500: UP 0.3 percent at 1,999.99 (close)
New York - Nasdaq: UP 0.2 percent at 4,717.02 (close)
London - FTSE 100: UP 1.1 percent at 6,199.43 points (close)
Frankfurt - DAX 30: UP 0.7 percent at 9,824.17 points (close)
Paris - CAC 40: UP 0.9 percent at 4,456.62 points (close)
EURO STOXX 50: UP 0.8 percent at 3,037.35 points
Tokyo - Nikkei 225: UP 0.3 percent at 17,014.78 (close)
Shanghai - composite: UP 0.5 percent at 2,874.15 (close)
Hong Kong - Hang Seng: UP 1.2 percent at 20,176.70 (close)
Euro/dollar: UP at $1.1008 from $1.0957 on Thursday
Dollar/yen: UP at 113.79 yen from 113.69 yen