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US stocks shoot up on stronger data

US stocks shot higher yesterday, ending a four-day losing streak as optimism about upcoming earnings gathered steam and data showed the services sector expanded for the first time since August 2008.<br /><br />The Dow Jones industrial average was up 112.08 points, or 1.18 per cent, at 9,599.75. The Standard &amp; Poor&rsquo;s 500 Index closed up 15.23 points, or 1.49 per cent, at 1,040.44. The Nasdaq Composite Index gained 20.04 points, or 0.98 per cent, to 2,068.15.<br /><br />Meanwhile, European shares ended 0.8 per cent higher as better-than-forecast data in the US and Europe helped lift banks, while telecoms were boosted by merger activity between Telenor and Alfa Group.<br /><br />The FTSEurofirst 300 index of top European shares closed up 0.8 per cent at 971.21 points, after falling for three sessions in a row.<br /><br />The index, which slumped 45 per cent last year, is up 17 per cent in 2009 and has surged over 50 per cent since hitting a record low in early March.<br /><br />Data on both sides of the Atlantic also reassured investors after non-farm payrolls data contributed to a 1.9 per cent fall on Friday.<br /><br />The US service sector expanded in September at a faster pace than expected, with the Institute for Supply Management&rsquo;s services index coming in at 50.9, compared to a forecast of 50.<br /><br />Markit&rsquo;s Eurozone Services Purchasing Managers&rsquo; Index of around 2,000 companies showed the euro zone&rsquo;s services economy returned to growth for the first time in 16 months in September at a slightly better rate than first expected, but job losses grew.<br /><br />Banks, which are sensitive to changes in risk appetite, gained. Barclays, HSBC, BNP Paribas and Deutsche Bank added 0.5-1.7 per cent.<br /><br />However, investors said sentiment was still relatively fragile and third-quarter results from the US companies, which get under way this week with aluminium giant Alcoa, will determine where share prices end up.