* Dollar rallies to 6 1/2 month high over Europe concerns
* Wall St slides as European fiscal worries offset data
* Oil falls below $73 a barrel on weak demand outlook
* Bonds gain after stocks turn lower; commodities slip
(Updates with close of U.S. markets)
By Herbert Lash
NEW YORK, Jan 29 (Reuters) - The dollar rose to a
6-1/2-month high against the euro on Friday and U.S. stocks
fell as concerns about the fiscal health of several euro zone
countries raised an aversion to risk among investors.
News that the U.S. economy grew at the fastest pace in more
than six years in the fourth quarter also lifted the dollar,
boosting views the United States was recovering faster than
other developed countries. For details see: []
Data showing the U.S. economy grew at a 5.7 percent annual
rate raised expectations the U.S. Federal Reserve could hike
interest rates before the European Central Bank.
Investors also remained concerned about the fiscal health
of Greece, Spain and Portugal, helping push the euro below
$1.39 for the first time since early July. []
Many markets ended lower in January, which often proves to
be a harbinger for the rest of the year. A slide in many
markets last January belied that historical indicator after
stocks and other assets rallied strongly for much of the year.
MSCI's all-country index of global stocks <.MIWD00000PUS>
fell 0.8 percent on Friday, and about 4.4 percent in January.
U.S. stocks pulled back from early gains even as Greek and
European Union officials said there was no chance of a Greek
default or EU bailout. []
"Sovereign debt issues continue to weigh on the market,"
said Robert Francello, head of equity trading for Apex Capital
in San Francisco.
"The pattern has been to sell into the weekend, wait for
sovereign risk and sovereign default news in Europe and if it
doesn't happen, the relief rally begins."
The Dow Jones industrial average <> closed down 53.13
points, or 0.52 percent, at 10,067.33. The Standard & Poor's
500 Index <.SPX> fell 10.66 points, or 0.98 percent, at
1,073.87. The Nasdaq Composite Index <> slid 31.65 points,
or 1.45 percent, at 2,147.35.
Commodity markets, especially copper and oil, ended January
with their worst losses in more than a year as the surging
dollar and weak demand outlook caused prices to stumble after a
strong run in 2009. []
The Reuters-Jefferies CRB index <.CRB>, a commodities
bellwether that tracks prices across 19 futures markets, ended
the month down about 6 percent -- its worst loss since November
2008, when it fell almost 10 percent.
Oil prices fell below $73 a barrel, marking a more than 8
percent loss for the month, as lagging energy demand outweighed
stronger-than-expected U.S. economic data. []
U.S. oil for March delivery <CLc1> fell 75 cents to settle
at $72.89 a barrel, down $6.47 versus the end-December close.
In London, ICE Brent crude for March <LCOc1> fell 67 cents
to settle at $71.46 a barrel.
Copper suffered its worst monthly losses since December
2008. []
Gold also fell, marking a third straight week of declines,
as the resurgent dollar and uncertainty over a U.S. proposal to
limit risk taking by some banks damped sentiment.
[]
U.S. April futures <GCJ0> settled down $1 at $1,083.80 an
ounce in New York.
U.S. Treasuries rose on month-end position-squaring,
nervousness about the fiscal situation of some European nations
and expectations the U.S. economy would grow at a slower pace
than the torrid rate in the fourth quarter of 2009.
[]
The benchmark 10-year U.S. Treasury note <US10YT=RR> rose
12/32 in price to yield 3.59 percent.
Asia Pacific stocks outside Japan as measured by MSCI
<.MIAPJ0000PUS> fell 1.62 percent to a two-month low, while
Japan's Nikkei average <> fell 2 percent to a six-week
closing low.
(Reporting by Ellis Mnyandu, Wanfeng Zhou, Richard Leong and
Robert Gibbons in New York; Brian Gorman and Ian Chua in
London; writing by Herbert Lash; Editing by Leslie Adler and
Diane Craft)
