LONDON, Oct 2 (Reuters) - World stocks extended falls while the dollar jumped versus the euro on Friday after a report showed U.S. non-farm payrolls fell more sharply than expected in September.
U.S. employers cut 263,000 jobs, lifting the unemployment rate to 9.8 percent, the highest since June 1983, the Labour Department said. Payrolls have now dropped for 21 consecutive months.
Analysts polled by Reuters had expected non-farm payrolls to drop 180,000 in September.
The MSCI world equity index fell to 277.80 from 278.76 just prior to the release of the data. It was down 1.3 percent, falling for the second day running.
The euro fell to session lows against the dollar to $1.4481 from $1.4539 before the data. The dollar slipped against the yen to 89.25.
Spot gold extended falls, dropping more than 1 percent to $986.60/oz after the data.
Benchmark 10-year Treasury notes traded up 18/32 in price, having been up by 5/32 moments before the jobs data. The 10-year bond yield, which moves inversely to price, was at 3.11 percent, compared with 3.16 percent before the data. (Reporting by Emelia Sithole-Matarise, editing by Mike Peacock)