European Markets Trimmed Gains After Weak U.S. Jobs Report

(RTTNews) - The European markets pared their early gains after the weaker than expected U.S. jobs report for December on Friday, but still finished in positive territory. Pharmaceutical companies and luxury goods companies were among the strongest performers. Oil companies also shrugged off a series of downgrades and climbed on higher energy prices.

China's exports growth eased more than expected in December, while imports beat expectations signaling robust domestic demand, the latest figures released by the General Administration of Customs showed Friday. As a result, the trade surplus missed forecast sharply at the end of the year.

The trade balance showed a surplus of $25.6 billion in December, down from $33.8 billion in November. The forecast was for a surplus of $32.15 billion.

Standard & Poor's confirmed Germany's coveted 'AAA' rating on Friday as the economy remains highly diversified and competitive with ability to absorb large economic and financial shocks.

The 'stable' outlook reflects the assessment that public finances and strong external balance sheet will continue to withstand potential financial and economic shocks.

The rating agency expects the largest euro area nation to grow above 1.5 percent in 2014-2016. The nation has avoided the need for significant private-sector deleveraging and fiscal consolidation.

The Euro Stoxx 50 index of eurozone bluechip stocks increased by 0.41 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.41 percent.

The DAX of Germany climbed by 0.55 percent and the CAC 40 of France advanced by 0.60 percent. The FTSE 100 of the U.K. rose by 0.73 percent and the SMI of Switzerland gained 0.83 percent.

In Frankfurt, Lufthansa surged by 8.85 percent. The company expects a decrease in its fuel bills.

Metro gained 2.82 percent, on a report that its biggest shareholder may exert pressure for a sale of some units.

SMA Solar surged by 14.19 percent. Deutsche Bank upgraded the stock to ''Buy'' from ''Hold.''

BMW dipped by 0.85 percent. Merrill Lynch downgraded the stock to ''Neutral'' from ''Buy.''

Siemens was also downgraded to ''Neutral'' from ''Buy'' at Merrill Lynch. The stock gained 0.06 percent.

Brenntag declined by 2.39 percent, after a negative broker recommendation at UBS.

In Paris, Saint-Gobain advanced by 3.06 percent. Cap Gemini finished up by 2.23 percent, after India-based peer Infosys Technologies lifted its annual revenue forecast.

Loreal was upgraded to ''Neutral'' from ''Underperform'' at Merrill Lynch. The stock climbed by 1.06 percent.

In London, Fresnillo rose by 1.36 percent. Barclays downgraded its rating on the miner to ''Equalweight'' from ''Overweight.''

Glencore Xstrata rose by 3.50 percent, after Barclays upgraded it to "Overweight" from "Equal weight."

Royal Dutch Shell climbed by 2.10 percent, after Exane BNP upgraded it to "Outperform" from "Neutral." BP added 0.69 percent, despite a downgrade to "Neutral" from "Overweight" at Exane BNP.

Tullow Oil surged by 7.63 percent, on media reports that it could be a takeover target for Statoil.

JD Sports Fashion said its board believes that the Group remains on course to deliver headline profit before tax and exceptional items in line with current market view. The stock increased by 1.63 percent.

Swatch increased by 3.55 percent in Zurich. The firm issued a positive outlook for 2014. Luxury group Richemont also gained 3.97 percent in Zurich and luxury eyewear firm Luxottica added 1.98 percent in Milan. Shares of Burberry advanced by 2.60 percent in London.

Carlsberg decreased by 0.60 percent in Copenhagen, after Goldman Sachs downgraded it to "Sell" from "Neutral."

French industrial production returned to growth in November, and the rate of expansion exceeded economists' forecast, latest data showed Friday.

Overall industrial production grew 1.5 percent on an annual basis in November, ending fourth months of successive declines, statistical office Insee said. In October, production had decreased by 0.3 percent. Economists expected output to rise 0.9 percent in November.

The French economy probably expanded 0.5 percent in the fourth quarter of 2013 compared to the previous quarter, a third estimate released by Bank of France showed Friday. The latest estimate is unrevised from the previous forecasts by the central bank. In the third quarter, the gross domestic product contracted 0.1 percent.

British industrial output remained flat in November and construction output logged the sharpest decline so far in 2013, confounding recent survey data that underscored robust activity in the fourth quarter.

Industrial production remained unchanged in November compared with the previous month, the latest figures from the Office for National Statistics showed Friday. The unexpected stagnation in production followed two successive months of improvement. Output increased by a revised 0.3 percent in October and 0.9 percent in September. Economists had forecast a 0.4 percent increase in November.

Construction output rose 2.2 percent year-on-year, which was the sixth consecutive month of annual growth.

A boost in online sales helped push retail sales in the United Kingdom higher in December. The British Retail Consortium reported Friday that same-store sales were up 0.4 percent from December 2012.

Partly reflecting the impact of severe winter weather, the Labor Department released a report on Friday showing that employment in the U.S. increased by much less than expected in the month of December.

The report said non-farm payroll employment edged up by 74,000 jobs in December compared to economist estimates for an increase of about 200,000 jobs. The job growth in December reflects a substantial slowdown from the upwardly revised increase of 241,000 jobs in November.

At the same time, the Labor Department said the U.S. unemployment rate dropped to 6.7 percent in December from 7.0 percent in November. The drop pulled the unemployment rate down to its lowest level since October of 2008.

Wholesale inventories in the U.S. increased in line with economist estimates in the month of November, according to a report released by the Commerce Department on Friday. The report said wholesale inventories rose 0.5 percent in November following a revised 1.3 percent increase in October. Inventories were up 3.3 percent compared to the same month a year ago.