European markets trade higher on Non Farm optimism

Giles Watts, Head of Equities, City Index commented: "European markets traded higher on Friday with investors making some speculative buys in the hope that this afternoon's Non Farm Payrolls outperform market consensus.

The late rally in the US markets overnight, coupled with a healthy stock performance in Asia, locked in a positive start for European equities.

Non Farm Payroll

We have also seen a degree of optimism from some investors that after last month's outperforming Non Farm Payroll data, today's jobs figures could yet again beat expectations and this has facilitated some speculative buys this morning. However, most investors are waiting on the sidelines refraining from adding further risk to their portfolios until the jobs data comes out at 1-30pm GMT.

The market consensus is for a flat reading but considering how bullish November's figures were, a positive reading cannot be discounted. If we were to get a healthy growth in jobs, it could be a strong indicator that the US jobs market is firmly in recovery mode and the market reaction could be immediate.

The majority of individual stock moves have been triggered by broker upgrades today with both ENRC and Barclays the main beneficiaries.

Eurasian Resources leads

ENRC leads today's gainers in London with investors boosted by RBS upgrading their stance on the stock to a ‘buy' and increases its EBITDA forecast 19%. The news has been well received by investors who have looked to increase their holdings as a result.

Barclays gains

Barclays shares have also been in demand today after UBS upgraded their recommendation on the stock to a 'buy' citing its confidence on the bank's operating conditions for 2010. UBS have also raised its Barclays share price target to 392p and this has triggered further demand for the stock from investors this morning."