* U.S. payrolls decline less than expected in February
* Successful bond sale ease immediate Greek debt concerns
* Crude extends gains after jobs data, China stimulus remarks
By Emelia Sithole-Matarise
LONDON, March 5 (Reuters) - Better-than-forecast U.S.
non-farm payrolls lifted world equities and the dollar on
Friday, setting Wall Street up for further gains.
The U.S. Labor Department said U.S. employers cut 36,000
jobs in February, leaving the unemployment rate unchanged at 9.7
percent. Economists had expected a loss of 50,000 jobs and the
rate to edge up to 9.8 percent.
Analysts had said a fall in the payrolls numbers was likely
in February as severe weather that affected large swaths of the
country kept some workers at home.
"I think it's a reasonably encouraging report. I think it's
likely we would have had an increase had the weather been
normal, though it's difficult to tell the precise impact of the
weather," said David Sloan, 4Cast chief economist North America.
"Even if the weather impact was zero, job losses were
minimal. The unemployment rate was unchanged, that was quite
encouraging as well. Earnings are subdued; that should keep
inflationary pressures low."
The dollar was up 0.4 percent against a basket of major
currencies <.DXY> after the jobs report while Europe's
FTSEurofirst 300 <> extended gains to around 1 percent, on
course for a sixth straight day of gains.
TheMSCI world equity index <.MIWD00000PUS> was up 0.3
percent while U.S. crude oil futures rose $1, hitting nearly an
eight-week high.
The dollar regained some ground versus the euro with the
single currency last 0.2 percent lower at $1.3554 <EUR=>. The
euro had steadied after dropping to $1.3549 on Thursday as
European Central Bank President Jean-Claude Trichet said the
recovery in the euro zone would be uneven.
Major investment houses have started to push back
expectations for a first rise ECB rates after the central bank
extended unlimited lending to banks for longer than expected.
[]
GREEK WORRIES
Investors were also willing to take on riskier bets on more
encouraging signs that Greece will be able to finance its debts
after it successfully raised 5 billion euros on Thursday via a
10-year bond syndication.
Greek government bonds outperformed euro zone benchmark
German Bunds, with the premium investors demand to buy 10-year
Greek debt rather than Bunds falling to 288 basis points from
299 bps in late European trade on Thursday.
But some investors still fretted about the longer-term
outlook for the highly-indebted euro zone member, keeping the
single currency on the defensive despite Greece's successful
bond issue.
"Greece must borrow more than 50 billion euros to cover
maturing debt and interest payments this year and, given the
debt placement schedule of other European countries, it is still
far from assured that Greece's upcoming bond sales will be
oversubscribed as yesterday's," Barclays Wealth said in a note.
German officials and the chairman of the group of countries
using the euro ruled out any immediate provision of financial
aid for Greece before talks on Friday with Prime Minister George
Papandreou. []
(Additional reporting by Dominic Lau; editing by Patrick
Graham, John Stonestreet)
