By Sam Forgione
NEW YORK (Reuters) - U.S. stocks snapped two straight sessions of losses on Thursday after a better-than-expected reading on the labour market boosted optimism ahead of a key U.S. jobs report, while oil prices tumbled on fears of worsening oversupply.
Data showing an unexpected fall in the number of Americans filing new claims for unemployment benefits boosted sentiment before the U.S. Labor Department's non-farm payrolls report for March, which will be released on the Good Friday holiday.
U.S. and European stock markets will be closed on Friday. Economists polled by Reuters expect a gain of 245,000 jobs, down from 295,000 in February.
Trading could become volatile as market participants position themselves for Friday's data. Weak payrolls would not necessarily spook Wall Street, however, since a below-consensus jobs number could ease concerns of a nearer-term rate rise from the Federal Reserve.
"People are looking ahead to the jobs report and right now it would be a surprise if it was weaker than expected," said John Carey, portfolio manager at Pioneer Investment Management in Boston, though he said playing it ahead of time could be tricky.
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Oil prices fell as officials from the big global powers stayed locked in nuclear talks with Iran. Tehran is hoping for a deal that will end crippling economic sanctions and allow it to sell millions of barrels of oil.
A measure of equity indexes worldwide rose, boosted by gains in U.S., emerging markets and Japanese shares. Emerging market stocks hit a one-month high, and Japan's Nikkei average rebounded from a three-week low. European shares slipped after Greece's lenders said the country needed to do more to unlock financial aid.
MSCI's all-country world index was last up 0.67 percent at 427.39, while its emerging markets index <.MSCIEF> gained 1.17 percent to 994.46. The FTSEurofirst index of 300 leading European companies was down 0.25 percent at 1,585.95.
The Dow Jones industrial average was up 0.33 percent at 17,756.62. The S&P 500 was up 0.35 percent at 2,066.82. The Nasdaq Composite was up 0.13 percent at 4,886.49.
Brent crude was down $1.80, or 3.15 percent, at $55.3 a barrel. U.S. crude fell 80 cents, or 1.6 percent, to $49.29.
U.S. Treasury debt prices slipped after the better-than-expected jobless claims data. Benchmark 10-year Treasury notes were last down 8/32 in price to yield 1.9 percent, from a yield of 1.87 percent late Wednesday.
The dollar slipped against a basket of major currencies, despite the strong U.S. data, as traders took profits from bullish dollar positions ahead of the jobs report, which could lead to volatile trading on thin volumes in the currency market.
Thursday's unemployment data, "after disappointments, will help the dollar, but the focus is still on Friday's jobs report," said Vassili Serebriakov, currency strategist at BNP Paribas in New York.
The dollar index, which measures the greenback against a basket of six major currencies, was down 0.69 percent at 97.508 .
Spot gold prices fell $8.55, or 0.71 percent, to $1,195.45 an ounce.
(Reporting by Sam Forgione; Additional reporting by Lionel Laurent in London and Daniel Bases and Ryan Vlastelica in New York)