* FTSE 100 up 0.5 pct, hitting a more than 3-week high
* U.S. non-farm payrolls due at 1230 GMT
* Autonomy extends gains on bid target hopes
By Dominic Lau
LONDON, Sept 3 (Reuters) - Britain's leading share index hit
a more than three-week high on Friday as the market looks beyond
a weak employment picture in the United States after factoring
in a soft patch in the pace of the economic recovery.
Shares in Aggreko <AGGK.L>, the world's largest provider of
temporary power, climbed 4.9 percent, topping the FTSE 100
<>, with traders citing talk on the FT Alphaville website
that it may be the subject of bid interest from Swiss
engineering group ABB <ABBN.VX>. Aggreko declined to comment.
U.S. non-farm payrolls, due at 1230 GMT, are forecast to
have fallen 100,000 after declining 131,000 in July, according
to a Reuters survey. []
The FTSE 100 <> was up 28.2 points or 0.5 percent at
5,399.24 at 1037 GMT, extending its gains to the sixth session.
The UK benchmark is up 3.8 percent so far this week and is on
track to end a three-week losing streak.
Autonomy <AUTN.L> advanced 3.4 percent, making it among the
top FTSE 100's gainers and extending Thursday's 5.2 percent rise
on expectations that the UK software maker could be a bid
target.
Index heavyweight Vodafone <VOD.L> rose 0.4 percent after
both Deutsche Bank and BofA Merrill Lynch raised their price
target on the mobile phone operator.
"Jobs data this afternoon will have to be exceptionally poor
for this market to get a knock on...If we were going to break
(lower), we would have broken last week but we haven't," Jawaid
Afsar, trader at Securequity, said.
"Having said that, we have a very good run this past week.
If we do pull back, it's going to be just profit taking, no
serious damage."
Fears about the state of the global recovery have eased
somewhat this week on surprisingly strong manufacturing data
from the United States and China, while economic figures from
Australia also improved confidence.
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For a graphic on U.S. non-farm payroll data, click on
http://graphics.thomsonreuters.com/F/09/US_NFPP0910.gif
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LOWER VOLATILITY
The FTSE 100 volatility index <.VFTSE> fell 3.2 percent,
hitting a one-week low and indicating a firmer appetite for
risk.
"We had a bit last week felt like Armageddon with the
magnitude of the deterioration of the U.S. housing numbers and
the durable goods," said Philip Lawlor, investment strategist at
Smith & Williamson.
"You get a bit of rebound, the market got very oversold," he
said. "There is a bit of an asymmetric in the market at the
moment...It the labour market numbers came out 50,000 stronger
than expected, you will get a much bigger reaction on the upside
than if they actually come out 50,000 weaker."
Economy-sensitive banks <.FTNMX8350> gained 0.7 percent,
with Barclays <BARC.L> up 2.1 percent and Standard Charatered
<STAN.L> rising 1.1 percent.
Despite the recent gains, the FTSE 100 <> is still
looking cheaper than other major indexes. It carried a one-year
forward price-to-earnings of 9.55 times, compared with U.S. S&P
500's <.SPX> 11.55 and Germany DAX's <> 9.87, according to
Thomson Reuters Datastream.
(Graphics by Scott Barber and additional reporting by Simon
Falush; Editing by Michael Shields)
