<div>World bond and stock markets rose on Friday after a bruising week and sterling jumped to a two-month high after the business-friendly Conservative party won Britain's national elections.</div><div> </div><div>Sterling was up 1.4 percent against the dollar and London's FTSE led equity markets with a 1.5 percent surge to help European shares rebound from two-month lows and wipe out what had looked like being a second week of losses.</div><div> </div><div>With more than 75 percent of the seats counted in the UK, the Conservatives were set to govern for another five years, quashing the pre-election fears the result could have been too close to form a stable government.</div><div> </div><div>"The surprisingly decisive result reduces uncertainty over the next (UK) government," analysts at Morgan Stanley wrote in a note.</div><div> </div><div>Confidence was also given a big lift as bond markets recovered after one of the most turbulent weeks in Europe for decades.</div><div> </div><div>Most government bond yields dropped back in early trading but the pounding of recent days which has been triggered by signs of a rebound in inflation, still left normally rock-solid German Bunds on course for a big weekly spike in yields.</div><div> </div><div>The bond stabilisation helped investors cast off their normal caution ahead of monthly U.S. non-farm payroll jobs data and its implications for when the Federal Reserve raises interest rates.</div><div> </div><div>Economist polled by Reuters expect the figures to show a jump of 224,000 new jobs in April after 126,000 in March and a run of generally disappointing U.S. data since then.</div><div> </div><div>"The U.S. economy had virtually a zero growth in January-March. If it remains weak after April, a rate hike by the Federal Reserve may be delayed further," said Shuji Shirota, head of macro economics strategy at HSBC Securities in Tokyo.</div><div> </div><div>The dollar inched up ahead of the data but it was completely in the shadow of sterling following the election outcome.</div><div> </div><div>As well as against the dollar, the UK currency 1.7 percent against the euro and yen to notch its biggest trade-weighted rise since 2010.</div><div> </div><div>"Viewed within the context of the UK's large current account deficit, the policy uncertainty removed by today's result will be a relief for some previously nervous foreign investors," said Adam Myers, European head of FX strategy at Credit Agricole.</div><div> </div><div><strong>Euro Sags</strong></div><div>Overnight in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.5 percent as it recovered from a one-month low.</div><div> </div><div>Tokyo ended up 0.5 percent, but China's mainland stock index was the stand-out as it jumped 2 percent to claw this week's losses back to 4 percent. The gains came despite Chinese exports sharply missing forecasts with surprise 6.4 contraction in April.</div><div> </div><div>Bonds were also helped by a dip in oil prices: A steady rise in oil prices since March had been cited as one reason behind the rout in bonds as higher oil prices tend to boost inflation - a major risk for fixed-income investors.</div><div> </div><div>Brent crude oil futures hovered at $65.88 per barrel, stepping back from Wednesday's five-month high of $69.63.</div><div> </div><div>(Reuters)</div>