Tepid US employment figures for October released today will help allay fears of the country returning to recession.
Unemployment dropped marginally to nine per cent and jobs continued to rise, although the number of jobs added was lower than September.
Non-farm jobs rose by 80,000 compared to what was originally reported as an increase of 103,000 in September, according to the Bureau of Labor Statistics.
However, September’s increase was revised up to 158,000, raising hopes that October’s real rise may have been much higher.
Marcus Bullus, trading director at MB Capital, said: "There is increasing evidence that the US labour market is stabilising, and with this latest move in the right direction, it's tempting to start regarding the glass as half full.”
Unemployment was down from 9.1 per cent in September, but within the 9-9.2 per cent range seen since April.
Joshua Raymond, Chief Market Strategist at City Index, said: “The upward revisions brightens dampened expectations for a struggling US labour market, whilst a surprisingly, yet marginal, drop in the unemployment rate to nine per cent from 9.1 per cent also helped sentiment.”
Private sector employment continued to rise, with modest job growth in professional and businesses services, leisure and hospitality, health care, and mining.
Meanwhile government employment continued to fall.
Uncertainty over the progress of cross-party talks aimed at finding $1.2 trillion (£750bn) cuts to government expenditure are thought to be hitting employer’s confidence in the economy.
The deadline for agreement is 23 November.
The ongoing crisis in the Eurozone may also be making damaging confidence and making companies cautious.