Dollar rallies on U.S. data, stocks trade flat

Fri Nov 14, 2014 4:22pm EST
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By Herbert Lash

NEW YORK (Reuters) - The dollar rallied on Friday, helped by unexpectedly strong U.S. retail sales data, but global equity markets traded flat after a hefty run-up over the past three weeks put a damper on big gains in the near term.

U.S. retail sales rose 0.5 percent in October after stripping out volatile gasoline and food services. The dollar index touched its highest since June 2010 at 88.267, but later pared gains to be down 0.15 percent at 87.540.

MSCI's all-country world index edged up 0.13 percent, while Wall Street closed mixed near flat.

European shares fell, according to one measure, as mixed euro zone growth data showed the French and German economies growing marginally but others like Italy still firmly in recession.

The pan-European FTSEurofirst 300 index closed down 0.1 percent at 1,345.20.

Stocks on Wall Street mostly traded slightly lower. The benchmark S&P 500 index has gained 12 percent and MSCI's ACWI has gained 8 percent from their respective lows three weeks ago.

Philip Orlando, chief equity market strategist at Federated Investors in New York, said stocks were dramatically oversold in mid-October, and that data on Friday confirmed in his mind that holiday sales at year's end will be "pretty good."

"The market at this point, as a forward-looking discounting mechanism, has started to price some of the good news in," Orlando said. "We've seen the lion's share of the move. Now we just sort of grind higher," he said.   Continued...

Traders are pictured at their desks in front of the DAX board at the Frankfurt stock exchange November 13, 2014.     REUTERS/Remote/Stringer