* Private U.S. employers added 297,000 jobs in December
* Sharpest jump on record, eclipsed economists' estimate
* Stocks pare losses; U.S. dollar extends gains
By Jonathan Spicer
NEW YORK, Jan 5 (Reuters) - A surprise surge in U.S. private-sector employment last month to its highest level on record provided the most bullish signal in months that the U.S. economy is slowly mending.
Private employers added 297,000 jobs in December, triple the median estimate by economists and up from the gain of 92,000 in November, an ADP Employer Services report showed on Wednesday.
The news reduced early losses in U.S. stock index futures, though the stock market was still expected to open lower. The jobs report helped send the price of the U.S. 30-year Treasury bond a full point lower.
"You cannot ignore the strength of this report," Tom Porcelli, a U.S. economist at RBC Capital Markets. "With small business now beginning to start to ramp up hiring, it's safe to feel better about the labor backdrop."
Adding to the rosy picture, the number of planned layoffs at U.S. firms fell last month to the lowest level in 10 years, according to a report by consultants Challenger, Gray & Christmas Inc. [ID:nNLL4CE7RM]
Tempering some of the optimism on Wednesday, an industry group said applications for U.S. home mortgages ebbed in the last couple of months of the year, with loan rates hovering around their highest levels in seven months. [ID:nNLL4CE7RN]
The U.S. dollar extended gains against the yen and the euro.
The ADP figures came ahead of the government's much more comprehensive labor market report due on Friday, which will include both public and private sector employment.
That report is expected to show a rise in overall nonfarm payrolls of 140,000 in December, based on a recent Reuters poll of analysts, but a rise in private payrolls of 145,000. [ECI/US]
Economists often use the ADP report to fine-tune their forecasts for the payrolls numbers, though it is not always accurate in predicting the outcome.
The ADP report is jointly developed with Macroeconomic
Advisers LLC.
U.S. private sector jobs rise by record in Dec:
http://r.reuters.com/muc84r
U.S. planned layoffs fell to lowest since 2000 in Dec:
http://r.reuters.com/wec84r
U.S. mortgage applications ebbed in the last two weeks of 2010 amid the holiday season.
http://r.reuters.com/gub84r
(Reporting by Jonathan Spicer)