By Jonathan Cable and Darren Ennis
LONDON/BRUSSELS (Reuters) - Business activity in European countries fell again in March, but the pace of decline slowed as efforts to revive economies took hold and pessimism ebbed after a plan by G20 leaders to kickstart global recovery.
A test of the optimism that followed Thursday's agreement by world leaders on a $1.1 trillion (744.3 billion pound) deal to combat the crisis will come when U.S. unemployment data for March is released later on Friday.
The United States probably continued to bleed jobs at a rapid rate in March, likely pushing up the jobless rate to 8.5 percent.
White House spokesman Robert Gibbs warned on Friday the United States was likely to see another grim jobs report.
"I think it's safe to expect -- without having seen them -- that we'll see additional severe job cuts in America," he said.
U.S. futures pointed to a higher open on Friday, despite forecasts for gloomy jobs data.
Economists have started to see "green shoots" in the U.S. economy after a bleak few months, and the labour market, a lagging indicator, is likely to be one of the last places where an improvement is seen.
In the 16-country euro area, companies also continued to slash jobs to cut costs, driving the Markit Eurozone Composite PMI employment index to a new low of 40.3, down from February's 40.8, a survey showed on Friday.
The euro zone's dominant service sector contracted sharply again in March, but not as rapidly as in February, according to the survey.
"With the rate of decline easing in the final month of Q1, and confidence improving to the highest since Lehman's collapse, there are signs that we may be over the worst," said Chris Williamson at data provider Markit.
EXPECTATIONS
Services business expectations also jumped sharply to a six-month high in March, the survey showed.
France and Italy saw optimism for the year ahead hitting six-month highs while it also picked up to a three-month high in Spain. But German companies remained downbeat on the 12-month outlook, growing more pessimistic.
"Overall, pretty optimistic that the euro area economy's recovery is closer and we can start to argue that the recovery will take place by the beginning of next year," Silvio Peruzzo at RBS said.
European Central Bank Governing Council member Nout Wellink also saw the chance of a pickup, in 2010. Traders cited anxiety ahead of the U.S. jobs data.
Asian stocks rose for a fourth straight day as perceptions of a coordinated global policy response grew after the G20 summit.
The leaders of the world's richest and biggest economies, which account for more than 80 percent of world trade, also agreed to tighten rules on tax havens, hedge funds and credit rating agencies.
The measures agreed would raise world output by 4 percent by the end of 2010, they said, although they were hazy on the amount of stimulus spending to date, with estimates ranging between $2 trillion and $5 trillion.
World Trade Organisation head Pascal Lamy welcomed G20 consensus to avoid protectionism and an agreement to support global trade flow.
"It is a very positive response," Lamy said. "Implementation now is something we will be watching."
(Additional reporting by Reuters bureaux around the world; Writing by Sue Thomas; Editing by James Jukwey and Keiron Henderson)