* U.S. jobs data grim but not as bad as some feared
* Wall Street, European shares gain; Japan loses 3.6 pct
* South Korea joins interest rate cut parade
* Dollar index weaker
(Updates with late U.S. markets, adds Obama, GM)
By Burton Frierson
NEW YORK, Nov 7 (Reuters) - Wall Street and European shares
rose on Friday as investors were relieved that U.S. jobs
figures did not live up to pessimists' worst fears after a
deluge of horrific economic reports this week.
U.S. President-elect Barack Obama said fixing the economy
would take time, which removed some of the froth from stocks'
gains, but he added that economic stimulus, job creation and
help for the auto industry were top priorities. For more, see
[].
U.S. employers slashed an unexpectedly steep 240,000 jobs
in October but financial markets had braced for a much worse
outcome in the days before release of the data.
[].
Bargain hunters bought beaten-down stocks after the report
and equities' exuberance pummeled government bonds, which
generally benefit more from weak economic news.
However, the jobs report gave few signs of hope for the
future and Obama's news conference illustrated the high level
of anxiety in markets to learn how the new leadership in
Washington will tackle the economic slump.
"He is showing he will be ready to hit the ground running
and that should provide some confidence to markets," said Greg
Salvaggio, senior currency trader at Tempus Consulting in
Washington.
"But the truth is that this economy is hemorrhaging. The
jobs report earlier today was awful, news from General Motors
were awful and his comments today won't be able to change
that."
The price of oil, which is sensitive to economic growth
prospects, overcame losses to rise back near $61 a barrel and
gold also gained. The U.S. dollar slipped against the euro.
The Dow Jones industrial average <> ended up 248.02
points, or 2.85 percent, at 8,943.81. The Standard & Poor's 500
Index <.SPX> was up 25.87 points, or 2.86 percent, at 930.75.
The Nasdaq Composite Index <> was up 38.70 points, or 2.41
percent, at 1,647.40.
The 4.09 pct drop for the Dow this week marked the worst
presidential election week for blue chips since Harry Truman
upset Thomas Dewey in 1948.
The pan-European FTSEurofirst 300 <> rose 1.84
percent. Japan's Nikkei average <> dropped 3.6 percent.
Payrolls data showed the world's largest economy shed many
more jobs than first estimated during August and September,
lifting total cuts to 1.2 million so far this year.
"I think the numbers are weak across the board but I think
they were well anticipated," said Thomas di Galoma, head of
U.S. Treasury trading at Jefferies & Co in New York, adding:
"It needed to be down 350,000 to really get the market
rolling."
BURNING MONEY
Obama, at his first formal news conference since Tuesday's
election victory, said help for the distressed U.S. auto
industry is a high priority of his transition team.
Obama urged the Bush administration to do "everything it
can" to accelerate disbursement of $25 billion in advanced
technology loans to the industry.
General Motors Corp <GM.N> burned through $6.9 billion of
cash in the third quarter and warned earlier on Friday that its
cash holdings would fall short of the minimum needed to run its
business without new funding or other drastic action.
Markets have been volatile as big developed economies head
for their first full-year contraction since World War Two.
Industry surveys this week showed U.S. manufacturing
suffered its worst slump in 26 years and a key gauge of the
service sector posted the lowest reading in its 11 years.
Those reports also indicated a sharp deterioration in
employment and were accompanied by news that U.S. private
employers made their deepest job cuts in six years last month
and that companies' planned layoffs surged to the highest in
nearly five years.
The reports were further evidence that the United States is
in the grips of the worst financial crisis in 80 years, which
has spread its debilitating economic effects around the globe
at an increasingly rapid rate in recent months.
It all started with this decade's boom and bust in the U.S.
housing market, and there were further signs of problems in
this sector on Friday. Pending sales of existing U.S. homes
fell in September. [].
RELIEF REIGNS
Still, Wall Street's relief rally reigned supreme on
Friday, sending government bonds lower.
"Treasuries were priced for Armageddon and we didn't get
Armageddon," said Kevin Flanagan, a fixed income strategist at
Morgan Stanley's wealth management arm in Purchase, New York.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was
down 22/32, with the yield at 3.77 percent.
The euro <EUR=> was up 0.37 percent at $1.2747 from a
previous session close of $1.2700.
U.S. light sweet crude oil <CLc1> rose 18 cents, or 0.3
percent, to $60.95 per barrel, and gold <XAU=> rose $2.10, or
0.29 percent, to $734.60.
(Reporting by Reuters bureaus in Asia, Europe and the
Americas; Writing by Burton Frierson; Editing by James
Dalgleish)
