Europe stocks rise after jobs data, Greek deal

LONDON (MarketWatch) � European stock markets closed higher for a third day in choppy action on Friday after Greece managed to pull off its debt-swap deal, while U.S. jobs data surprised to the upside.

The Stoxx Europe 600 index XX:SXXP , after trading as low as 263.78 earlier in the session,�ended 0.5% higher at 265.44 after the U.S. Labor Department reported that the economy added 227,000 jobs in February, mainly boosted by the private sector, while the unemployment rate stayed unchanged at 8.3%. U.S. jobs data

�The data were not particularly surprising, although it confirms a trend we�ve seen recently with improvement in the U.S. recovery and labor market,� said Victoria Cadman, economist at Investec Securities.

Stock prices were wobbly earlier after following the latest developments in the Greek debt-swap offer. Athens said 80% of private-sector debt holders agreed to a restructuring that would slash the face value of their bonds, and the government moved an important step closer to force resistant bondholders on board, which could bring the total participation rate to 96%. Greece's debt swap

Click to Play What Greece's latest moves mean

The complicated chess game in Greece might be nearing a Friday deadline, but then what? Vincent Cignarella explains what to expect from Greece in the next few weeks. Photo: Associated Press.

That move by the government could trigger the payout of credit-default swaps for investors who insured themselves against a Greek default. The International Swaps and Derivatives Association Inc. is due to rule on whether a payout should take place.

�The market has made some adjustments already, but if we get confirmation that the CDS get triggered we expect to see a small selloff. It raises a question of who has to pay for the CDS, because it�s not clear who is going to make the payment,� Cadman said.

The Greece ATHEX Composite index GR:GD �fell 2.2% to 752.35.

The news appeared to calm bond yields on some of the euro area�s other weaker government bond markets. Yields on 10-year Spanish government bonds ES:10YR_ESP declined 8 basis points to 4.97%.

However, yields on 10-year Italian government bonds IT:10YR_ITA �added 8 basis points to 4.81% after the country�s industrial production fell 2.5% in January, well below analysts expectations. Italian banks were among top decliners in Europe and Banca Monte dei Paschi di Siena SpA IT:BMPS �lost 5.2%, Banca Popolare dell�Emilia Romagna SCARLIT:BPE �declined 2.8% and Banca Popolare di Milano SCARL IT:PMI �fell 3.6%.

The FTSE MIB index XX:FTSEMIB �was 1.1% lower at 16,479.20.

Elsewhere, the German DAX 30 index DX:DAX �rose 0.7% to 6,880.21. Lifting the index, Linde AG DE:LIN �advanced 5.6% after the company posted a 3.6% rise in fourth-quarter profit and estimated higher sales and operating profit in 2012.

Also supporting the index, Merck KGaA DE:MRK �added 3.7% as Deutsche Bank upgraded the stock to buy from hold, citing a too pessimistic market view on the company�s earnings growth.

In France, the CAC 40 index FR:PX1 �traded 0.3% higher at 3,487.48, lifted by Sanofi SA FR:SAN �up 0.9%. UBS pointed to the drug maker as one of its favorite picks as it upgraded the sector to overweight. The bank said the sector accounts for some of the least-geared balance sheets and sees more safety in pharma than in telecoms and utilities, although those sectors offer higher yields.

The French index was, however, weighed down by Schneider Electric SA FR:SU , down 1% after Citigroup downgraded the stock to sell.

In London, Aggreko PLC UK:AGK �added 4% as its 2011 profit rose 8.6%. The FTSE 100 index UK:UKX �traded 0.5% higher at 5,887.49, further buoyed by Cairn Energy PLC UK:CNE �rising 2.7% after an upgrade to buy from hold from Societe Generale.

However, some miners weighed on the index after UBS downgraded the sector to neutral, citing signs of slowing steel demand in China and less support from macroeconomic data. Kazakhmys PLC UK:KAZ �shed 0.8% and Fresnillo PLC UK:FRES �lost 1.3% as Deutsche Bank downgraded the stock to hold from buy.

Outside the main index, London Stock Exchange Group PLC UK:LSE �jumped 6.4% after the firm said it had reached an agreement to buy a 60% stake in LCH.Clearnet Group Ltd.

Nobel Biocare Holding AG CH:NOBN , jumped 8% after Goldman Sachs added the stock to its conviction buy list from a neutral rating.