Traders at the New York Stock Exchange watch as markets rally after China announced 7.8% growth.you going Photograph: Richard Drew/AP  Share prices in Europe and the US hit fresh highs on Friday as news of strong economic growth in China added to investors' mood of relief at the end of a nailbiting week.  Since Wednesday night's last-ditch cross-party deal averted the risk of a debt crisis in the US, investors have refocused on the growth prospects for the world's major economies.  China expanded at an annual rate of 7.8% in the third quarter of 2013, according to official figures. That was stronger than the 7.5% pace recorded in the second quarter, and helped to assuage fears of a slowdown.  In the wake of that data, the FTSEurofirst 300 – which tracks the share prices of major companies across the eurozone – hit a five-year high of 1,276.92. The German DAX index closed at a record high. In London, the FTSE 100 ended the day up 0.7%, at 6,226.  "A strong improvement in Chinese GDP data along with an anticipation of continued Fed stimulus into 2014 has given Europe's markets further impetus into the end of the week, as investors celebrate the fact that the uncertainty of the last three weeks coming from the US has finally been concluded in the short term," said Michael Hewson, senior market analyst at CMC Markets.  On Wall Street, where investors had begun the week braced for the risk that the US Treasury could run out of cash to pay its bills, the S&P 500 was up by 0.4% by lunchtime, at a record 1739.73.  Markets were also buoyed by a strong trading report from corporate bellwether GE, while shares in Google hit an all-time high of $1,000, after the search engine group reported a jump in advertising. Google's shares began the year at $703.  Since the debt ceiling deal was sealed, markets have fastened on the hope that the likely hit to growth from the government shutdown will postpone the Fed's withdrawal of quantitative easing.  However, some analysts fear the rally may be short-lived. Guillermo Felices of Barclays said in a note on Friday that "the outlook for US equities remains challenging, even if tapering is delayed, given lingering political uncertainty, more expensive valuations and less scope for positive economic surprises."  The delayed monthly snapshot of the jobs market from the US Department of Labor, now due to be released next Tuesday, will be watched closely for signs of the marked improvement the Fed has said could prompt it to "taper" its $85bn-a-month bond-buying programme.
US debt deal and Beijing releasing figures of 7.8% growth sees Wall Street and European markets breathe with relief