European stock markets stable on new US jobs data

Europe's main stock markets steadied on Thursday as attention turned to US jobs data ahead of Greece's weekend referendum on its bailout.

Frankfurt's DAX 30 dipped 0.30 percent to 11,147.28 points and in Paris the CAC 40 lost 0.81 percent in value to stand at 4,841.88 in afternoon deals.

Outside the eurozone, London's FTSE 100 index edged up 0.35 percent to 6,631.41 points compared with Wednesday's close.

On Thursday, the euro rose to $1.1083 from $1.1053 late in New York on Wednesday.

Wall Street stocks rose moderately in opening trade Thursday after the Labor Department reported the US economy added 223,000 jobs in June.

Five minutes into trade, the Dow Jones Industrial Average was up 0.20 percent at 17,792.75, the broad-based S&P 500 rose 0.26 percent to 2,082.78 and the tech-rich Nasdaq Composite Index advanced 0.15 percent to 5,020.69.

While the headline US jobs number came in above the key 200,000 benchmark, the overall report was mixed. Average hourly earnings were flat compared with May and the Labor Department cut its estimates for job growth in April and May.

The payrolls report came amid views that the economy is gaining strength, and will temper expectations that the Federal Reserve will raise interest rates, possibly in September.

"The main focus for the markets today is the US jobs report, closely followed by any developments in Greece," said Phil McHugh, trading floor manager at Currencies Direct.

"The non-farm payrolls report provides a welcome distraction from Greece," added David Madden, market analyst at IG trading group.

"Greece may be out of the spotlight for the time being, but it should not be forgotten, and this weekend could be the end of the line for Greece and the euro," he added.

Greece's radical left government suggested it would resign if it fails to get its way in a referendum Sunday that could decide the country's financial future.

Although Athens insists the referendum focuses narrowly on tough austerity conditions attached to a bailout that expired on Tuesday, EU leaders say it is a vote on whether Greece wants to remain in the euro.

International creditors and markets are stepping back after days of dizzying drama over the Greek crisis to watch the outcome of the vote at the weekend.

The Athens stock market meanwhile remains shut, while the Greek population is left in financial limbo under capital controls imposed all this week to stem a bank run. They are limited to 60-euro ($67) daily ATM withdrawal caps, adding hardship to lives already ground down by years of austerity.

In a volatile week's trading, European stock markets rebounded on Wednesday as Greece proposed a reworked deal on its bailout that was closer to the position of its creditors.

Asian markets closed higher Thursday on hopes for a deal to keep Greece in the eurozone, but Shanghai tumbled again despite authorities relaxing trading rules to temper recent volatility.