By Mary Childs Dec. 4 (Bloomberg) -- Stock-index futures rallied in New York and European shares reversed an earlier drop, while Treasuries and gold retreated, as the U.S. government reported a smaller-than-estimated decrease in jobs last month. The dollar strengthened against a basket of six major counterparts. Futures on the Standard & Poor’s 500 Index expiring this month jumped 1.1 percent to 1,110.1 at 8:50 a.m. in New York after the Labor Department said the nation lost 11,000 jobs last month, compared with the median economist estimate for a decrease of 125,000. Europe’s Dow Jones Stoxx 600 Index erased a 0.6 percent decline and advanced 1.1 percent. The 10-year Treasury note’s yield increased seven basis points to 3.46 and oil erased an earlier slide. “The markets going to react really well to this,” said Burt White, chief investment officer at LPL Financial in Boston, which oversees $269 billion. “It’s great news.” The S&P 500 was poised to extend a weekly gain after the Labor Department said employers in the U.S. cut the fewest jobs in November since the recession began and the unemployment rate unexpectedly fell to 10 percent, signaling the recovery is lifting the labor market out of the worst slump since World War II. The Obama administration, under pressure after almost half of the 7.2 million jobs lost during the recession occurred since the president’s inauguration, is considering additional measures to boost job growth. Ben S. Bernanke, chairman of the Federal Reserve, has pledged to maintain record-low interest rates until joblessness subsides, even as a recovery takes hold. Gold for immediate delivery dropped 1.3 percent to $1,191.9 an ounce, retreating from a record $1,226.56 reached yesterday. Copper for delivery in three months added 0.2 percent to $7,097 a metric ton on the London Metal Exchange. To contact the reporter on this story: Mary Childs in New York at mchilds4@bloomberg.net.

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