* U.S. trade deficit smallest in four years
* Wall Street, European equity markets rise
* Dollar gains on trade data, might boost growth estimates
* Oil rises on Mideast, U.S. supply concerns
By Herbert Lash
NEW YORK, Jan 7 Global equity markets rose and
the dollar strengthened on Tuesday on news of the lowest U.S.
trade deficit in four years, the latest sign of a more robust
A report that showed German unemployment unexpectedly fell
in December on a seasonally adjusted basis, the first drop since
July, bolstered hopes that domestic consumption could lift
growth in Europe's biggest economy.
The U.S. Commerce Department said the trade gap fell 12.9
percent to $34.3 billion in November, the smallest deficit since
October 2009. October's shortfall on the trade balance was
revised down to $39.3 billion from a previously reported $40.6
The bigger-than-expected decline - economists polled by
Reuters forecast the trade deficit would slip to $40.0 billion
in November - could spur higher estimates for fourth-quarter
The upbeat data helped turn sentiment in equity markets
after a slow start to the year, building on a record flow of
fresh investment to stocks and related securities in 2013.
"Today we had some good news again so this momentum building
up for the last five years is going to continue to pull the
market higher," said Uri Landesman, president of Platinum
Partners, a New York-based multi-strategy hedge fund.
"People realize how much the market has been up, so there's
the desire to take profits," he said, adding that it is offset
by "incredible upward momentum."
U.S.-listed equity mutual funds and exchange-traded funds
took in a record $352 billion in 2013, topping a previous record
$324 billion in 2000, according to TrimTabs Investment
MSCI's all-country world stock index rose
0.39 percent, while the FTSEurofirst 300 index of top
European shares climbed 0.84 percent.
The benchmark S&P 500 was on track for the first gain of the
The Dow Jones industrial average was up 123.82
points, or 0.75 percent, at 16,548.92. The Standard & Poor's 500
Index was up 11.80 points, or 0.65 percent, at 1,838.57.
The Nasdaq Composite Index was up 37.13 points, or 0.90
percent, at 4,150.81.
Earlier, Asian shares fell for a fourth day, led by a 0.6
percent drop on Tokyo's Nikkei index.
The dollar gained, buoyed by the U.S. trade data. Stronger
growth could prompt the Federal Reserve to speed up the tapering
of its monthly bond purchases.
However, Eric Rosengren, president of the Federal Reserve
Bank of Boston, said the U.S. economy remains vulnerable the
longer inflation remains low. He reiterated a warning that
policy stimulus should be removed "only gradually." Rosengren is
one of the most dovish of U.S. central bankers.
The dollar traded 0.4 percent higher at 104.64 yen,
but remained below a five-year peak of 105.44 yen set last week.
The euro was last down 0.20 percent at $1.3600.
The dollar index, which tracks the greenback against a
basket of six major currencies, was up 0.21 percent at 80.825
Brent oil rose to $107 a barrel after five straight decline,
supported by doubts about a recovery in Libyan output, fighting
in Iraq and as cold weather across the central United States
Brent crude was up 32 cents to $107.05, after
settling lower in the previous five sessions, partly on
expectations of rising Libyan exports. U.S. crude was 37
cents higher at $93.80.
U.S. government bond prices rose, with the 10-year U.S.
Treasury note up 2/32 in price to yield 2.9540
German Bund futures were up 0.16 percent at 139.76