Shares rebound on Wall Street

Manufacturing figures boosted the market

US stocks have soared on Wall Street after figures showed the country's manufacturing sector was not as weak as feared.

The Dow Jones closed up 194.14 points, or 2.1% at 9,469.2, wiping out Tuesday's fall which had been triggered by worse-than-expected consumer confidence figures.

But news that the US manufacturing sector had grown for the third month in a row during September provided an excuse for investors to head back into the market.

The strong performance on Wall Street lifted share prices in Europe, with London's FTSE 100 index closing up 1.9%, Germany's Dax rising 2.2% and France's Cac 40 ending 1.8% higher.

'Disaster' averted

Figures from the Institute for Supply Management (ISM) showed that the recent recovery in the US manufacturing sector had continued, although the growth rate had slowed.

The ISM's manufacturing index registered 53.7 in September, down slightly from August's reading of 54.7.

A figure above 50 indicates expansion in the sector, while one below implies contraction.

"A lot of people were concerned that the (ISM) number was going to be a disaster," said Stephen Massocca, head of trading at investment bank Pacific Growth Equities.

"It showed that things were slowing, but I don't think it points to some people's worst fears."

Analysts also noted that many investors were snapping up bargains following recent falls on Wall Street.

"We're probably getting a natural technical bounce off the decline we've had over the last six or seven days," Mr Massocca said.

Jobs still scarce

While the ISM index showed the manufacturing was still growing, it also found that factories were still shedding jobs.

The ISM's employment index dropped to 45.7 from 45.9 in August.

The US economy has been showing signs of increasing growth in recent months but unemployment is showing few signs of improving.

On Tuesday, Ford added to the grim jobs news when it announced plans to cut 3,000 positions in the US.