U.S. retail stocks rose 0.7 percent as the unemployment rate fell to a three-year low.

The S&P Retailing Industry Group rose 4.36 points to 672.80 as the Dow Jones Industrial Average gave back earlier gains and closed up 0.3 percent, or 34.79 points, to 13,610.15.

Shares of Avon Products Inc., rose 7.2 percent to $17.39 after the company said Andrea Jung would step down as executive chairman at the end of the year, completing the company’s leadership transition. Other gainers included Hot Topic Inc., up 1.9 percent to $9.22; Dillard’s Inc., 1.8 percent to $76.12, and G-III Apparel Group, 1.7 percent to $37.20.

Bucking the trend was Caché Inc., which fell 15.7 percent to $2.74 after the company said  third-quarter comparable-store sales fell 3 percent and that losses would fall to 39 cents to 41 cents a share, versus a loss of 14 cents a year ago. The specialty retailer also said it hired Berglass + Associates to look for someone to fill the role of president and chief merchandising officer.

The Labor Department said unemployment last month fell to 7.8 percent from 8.1 percent in August — the lowest level since January 2009.

Still, the job market remains weak. A separate survey from Labor showed the U.S. added 114,000 new jobs, whereas economists say about 150,000 new jobs need to be created each month to keep up with population growth.

In Europe, markets were on the rise, boosted in part by the U.S. job gains.

The FTSE MIB in Milan rose 2.4 percent to 15,876.25, followed by the CAC 40 in Paris, which rose 1.6 percent to 3,457.04, and the DAX in Frankfurt, which climbed 1.3 percent to 7,397.87. The FTSE 100 gained 0.7 percent to 5,871.02.

Retail and luxury stocks were mostly up with the markets, with the day’s biggest gainers including Burberry Group, which was up 2.8 percent to 10.28 pounds; Hermès International, which climbed 3.1 percent to 218.60 euros, and LVMH Moët Hennessy Louis Vuitton, which climbed 1.5 percent to 122.10 euros.

Of the stocks that fell, Metro AG lost the most ground, sinking 9 percent to 21.46 euros, following a profit warning earlier in the day.

The euro traded at $1.30 against the dollar while the pound went for $1.61.