* Turmoil in emerging markets eases, Russia pledges to back rouble
* Safe-haven gold, U.S. Treasuries fall after U.S. GDP report
* U.S., European stocks rebound, emerging markets also turn higher
By Herbert Lash
NEW YORK, Jan 30 The dollar strengthened and global equity markets rebounded on Thursday after data showed the U.S. economy with plenty of momentum in the last quarter of 2013, boding well for continued growth and strong corporate earnings.
Turmoil in emerging markets eased, as the hard-hit Turkish lira and South African rand rebounded. Russia's central bank pledged unlimited foreign exchange interventions if the rouble strays outside its target band.
The rouble hit record lows against the euro early in the session, while the rand slid to multi-year troughs before rebounding. Moves earlier in the week by Turkey, South Africa and India to staunch capital flight had failed.
Emerging market currencies have felt the heat ever since the U.S. Federal Reserve said it would begin to trim its stimulus, a program that has injected more than $3 trillion into the U.S. economy and world markets since the financial crisis.
The initial reading of 3.2 percent growth in U.S. gross domestic product for the fourth quarter, combined with the 4.1 percent pace in the third quarter, resulted in the biggest half-year increase since the second half of 2003.
The strong GDP number, in line with economists' expectations, led equity markets in Europe to turn around and stocks on Wall Street to open higher. U.S. stocks advanced broadly, with the Nasdaq composite rising more than 1 percent.
The dollar gained against a basket of currencies, the appeal of the greenback revived against the safe-haven yen and Swiss franc.
"There's a lot of concern over what's happening overseas but in the domestic (U.S.) market GDP was pretty strong," said Cam Albright, director of asset allocation at Wilmington Trust Investment Advisors in Wilmington, Delaware. "If you see growth in the economy pointing to higher earnings growth, that will give markets more confidence in the United States."
The Fed, as expected, said on Wednesday it will cut its monthly bond purchases by $10 billion in February to $65 billion as policymakers saw less need for stimulus through the quantitative easing program.
"The end of QE is an indication the economy is getting better, though I'm not sure the market has entirely transitioned to that idea yet," Albright said.
The dollar was up 0.73 percent against a basket of currencies at 81.092.
The euro fell 0.81 percent against the dollar at $1.3553, while against the yen, the greenback was up 0.46 percent at 102.75.
A measure of global equity markets, MSCI's all-country world index rebounded, rising 0.3 percent. MSCI's emerging markets index, however, remained slightly lower, down 0.11 percent.
On Wall Street, the Dow Jones industrial average rose 166.14 points, or 1.06 percent, at 15,904.93. The Standard & Poor's 500 Index was up 24.50 points, or 1.38 percent, at 1,798.70. The Nasdaq Composite Index was up 83.50 points, or 2.06 percent, at 4,134.94.
In Europe the pan-regional FTSEurofirst 300 index of leading companies closed up 0.3 percent at 1,294.26.
Gold fell more than 2 percent, on track for its biggest one-day drop in more than a month, as the robust U.S. GDP data and the Fed's decision Wednesday to keep trimming its stimulus boosted the dollar and led traders to cash in gains in the metal.
U.S. gold futures for February delivery were down $18.20 an ounce at $1,244.00.
Brent oil rose to just over $108 per barrel and U.S. crude reached its highest in a month on bitter cold in the United States, which has boosted heating oil demand.
Brent crude was up 16 cents to $108.01 a barrel. U.S. crude was up 92 cents at $98.28.
The U.S. bond market retreated following Wednesday's rally, but some of the money leaving equities found its way into the developed world's government bond market.
German Bund futures rose 33ticks to settle at 143.23, while German 10-year yields fell to 1.62 percent, their lowest in nearly six months.
Benchmark 10-year Treasury notes were last down 11/32 in price to yield 2.7132 percent.