U.S. jobs data boosts European shares; banks up

* FTSEurofirst 300 index gains 1.5 percent

* Financial stocks gain after Irish bank stress tests

* Deutsche Boerse falls on rival NYSE bid

* For up-to-the-minute market news, click on [STXNEWS/EU]

By Joanne Frearson

LONDON, April 1 (Reuters) – European shares hit its highest
close in just over three weeks on Friday after strong U.S. jobs
data supported the view the global recovery was on track, while
technicals also pointed to a more bullish trend.

The pan-European FTSEurofirst 300 (.FTEU3: Quote, Profile, Research) index of top
shares closed up 1.5 percent at 1,141.40 points. Prospects for
technicals brightened after the euro zone’s blue chip Euro STOXX
50 (.STOXX50E: Quote, Profile, Research) index moved above its 50-day moving average, but
fund managers were still said to be stock selective.

“U.S. non-farm payroll (jobs) data seems to be continuing in
the right direction and the unemployment rate is coming down,”
Veronika Pechlaner, an investment manager on the 100 million
euro ($141.5 million) Ashburton European equity fund.

“But, we are still selective on consumer stocks as wage
inflation is still not coming through.”

Financial stocks featured among the top performers after
fund managers said the announcement by Dublin’s finance minister
that it would be unwise to impose losses on senior bondholders
at banks was being taken by the market as positive.

The Irish bank stress tests showed Ireland would need up to
24 billion euros more to recapitalise the financial system,
which was in line with expectations. [ID:nOAT004775]

“Everybody knew that the Irish banks needed additional
capital … But the most important thing is that there won’t be
any haircut on bonds,” a Paris-based analyst said.

Buyers came for Bank of Ireland (BKIR.I: Quote, Profile, Research) up 38.6 percent at
31 euro cents and Allied Irish (ALBK.I: Quote, Profile, Research) was 8.3 percent higher
at 21 cents.

UK banks and insurers performed well on the back of the
news, Barclays (BARC.L: Quote, Profile, Research) and Prudential (PRU.L: Quote, Profile, Research) gaining 4.3
percent and 3.4 percent respectively after falls on Thursday.

However, Irish Life & Permanent (IPM.I: Quote, Profile, Research) fell 58 percent
after its banking arm is expected to face state control
following plans to sell off its life business via an IPO.
[ID:nLDE7300KK]

Stock markets in the periphery euro zone countries gained.
Ireland’s ISEQ (.ISEQ: Quote, Profile, Research) rose 2.3 percent, Spain’s IBEX 35 (.IBEX: Quote, Profile, Research)
gained 1.5 percent, Portugal’s PSI 20 (.PSI20: Quote, Profile, Research) was up 1.4
percent and Italy’s benchmark (.FTMIB: Quote, Profile, Research) rose 1.1 percent.

In core Europe, Germany’s DAX (.GDAXI: Quote, Profile, Research) was 2 percent higher
and France’s CAC 40 (.FCHI: Quote, Profile, Research) was up 1.6 percent.

SWISS RE GAINS

Insurer Swiss Re (RUKN.VX: Quote, Profile, Research) gained 3.6 percent on talk of a
stake increase by U.S. investor Berkshire Hathaway (BRKa.N: Quote, Profile, Research),
while stock exchanges themselves were also in the spotlight.

Deutsche Boerse (DB1Gn.DE: Quote, Profile, Research) fell 1.4 percent after Nasdaq OMX
(NDAQ.O: Quote, Profile, Research) and IntercontinentalExchange (ICE.N: Quote, Profile, Research) unveiled a rival
bid for NYSE Euronext (NYX.N: Quote, Profile, Research) which was 27 percent above the
company’s valuation before the Frankfurt stock market operator
made its agreed bid in February. [ID:nL3E7F11TO]

Looking at the overall market analysts said valuations were
low and the corporate picture was improving and they remained
bullish for the medium term.

“We are positive on the outlook for equities. We see that
corporate earnings are well underpinned overall and that should
be supportive,” said Anko Beldsnijder, managing director of
MainFirst Asset Management, which manages 1 billion euros.

“We have added the metals and mining sector again to
overweight because of attractive valuations.”
($1=.7065 Euro)
(Additional reporting by Blaise Robinson; Atul Prakash; Editing
by Greg Mahlich)

U.S. jobs data boosts European shares; banks up