Business

Stocks rise on US jobless data and EU integration hopes

Global stock markets have risen as Europe's leaders called for closer economic integration as the way to ultimately resolve the debt crisis.

US stocks had their best week in more than two years, up 7%. Leading indexes in France, Germany and the UK were all up about 1%.

In a speech to the Bundestag, German Chancellor Angela Merkel said Europe was working towards "fiscal union".

US unemployment data showed the jobless rate falling sharply to 8.6%.

The Labor Department said 120,000 jobs were created in November, while the figures for the previous two months were revised up by a combined 72,000.

However, one reason for the drop in the unemployment rate was the large number of people who gave up looking for work, and therefore were no longer counted as part of the workforce.

Banking stocks in particular performed well. In the UK, Lloyds was up more than 4% while Barclays gained 5%. In Germany, Commerzbank climbed almost 6% and Deutsche Bank rose 4%, while in France BNP Paribas was up more than 7%.

Earlier, Asian markets closed slightly higher, with Japan's Nikkei index up 0.5% and Hong Kong's Hang Seng 0.2% higher.

Treaty changes

Mrs Merkel said steps were already being taken to create closer ties between eurozone members.

"We are not only talking about a fiscal union, we are beginning to create it," she said.

French President Nicolas Sarkozy also called for changes to EU treaties as a prelude to closer integration in a speech on Thursday evening.

Global markets made strong gains on Wednesday after the some of the world's biggest central banks announced a joint plan to ease tensions within the global financial system.

This centred around offering access to cheaper dollars for commercial banks in the hope of stimulating lending.

China also announced that it was cutting its bank reserve limit, also a move designed to boost lending.