LONDON (AP) — A run of impressive U.S. economic news combined with encouraging signals out of China to drive markets higher on Thursday, a day ahead of key jobs data that could have a bearing on the race to the White House.
Jobs data from the private payrolls firm ADP and the government's weekly jobless claims report raised hopes that Friday's official nonfarm payrolls figures for October won't disappoint.
The October manufacturing survey from the Institute for Supply Management also came in slightly better than expected, reinforcing hopes that the summer slowdown has ended.
And perhaps most encouraging, the Conference Board's measure of U.S. consumer confidence rose to a near-five-year high of 72.2 points in October, from 68.4 in September.
In combination, that helped stocks in the U.S. and Europe to power ahead.
"Stock markets are trading higher today as economic data painted a more rosy picture of the global economy," said Craig Erlam, market analyst at Alpari.
In Europe, the FTSE 100 index of the leading British shares closed up 1.4 percent at 5,861.92 while Germany's DAX rose 1 percent to 7,335.67. The CAC-40 in France ended 1.4 percent higher at 3,475.40.
In the U.S., the Dow Jones industrial average was up 1 percent at 13,228 while the broader S&P 500 index rose the same rate to 1,426.
All eyes will now turn to Friday's nonfarm payrolls figures for October. The figures, which often set the market tone for a week or two, may have an even bigger impact this month as they come just days ahead of next Tuesday's closely-fought presidential election.
"We now await the big show tomorrow, and with all of this morning's clues in hand, there is some modest upside risk to our initial call for a 130,000 gain in October nonfarm payrolls," said Robert Kavcic, an analyst at BMO Capital Markets.
Ahead of the figures, the dollar was getting some support in currency markets, especially against the Japanese yen. By late afternoon London time, the dollar was 0.3 percent higher at 80.15 yen while the euro was 0.2 percent lower at $1.2940.
Earlier Thursday, investors had breathed a sigh of relief when surveys showed Chinese manufacturing was growing again after contracting in recent months. China's economy, the world's second-largest, has slowed this year and fears of a sharp downturn have weighed on the outlook for the global recovery.
In China, Shanghai Composite index rose over 1.7 percent, to 2,104.4, its biggest jump in three weeks, while Hong Kong's Hang Seng index rose 0.8 percent, to 21,821.8.
Japan's Nikkei 225 index reversed early losses to gain 0.2 percent, to 8,946.9. South Korea's Kospi was down 0.7 percent at 1,898.4.
Oil prices got a lift from the rosier economic outlook, and the benchmark New York rate was trading 86 cents up at $87.10 a barrel.