Stock markets surged, hitting their highest levels since autumn as investors took in the news that the economy shed only 247,000 jobs in July, its smallest losses in nearly a year. And the American International Group, a black hole of losses and government bailouts, said Friday that it had turned a profit. Investors kept in the safety of government bonds and rolled the dice with riskier junk bonds.

“The recession is dead,” Dean Maki, an economist at Barclays Capital, declared in a research note. “Long live the recovery.”

With consumer stocks leading the way, the Dow Jones industrial average rose 113.81 points, or 1.2 /cent, to 9,370.07, while the wider Standard & Poor’s 500-stock index hit its highest levels since early October and was up 1.34 /cent, or 13.40 points, at 1,010.48. The Nasdaq was 1.37 /cent, or 27.09 points higher at 2,000.25.

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