* U.S. stocks pare gains on lower oil prices
* Oil down on sluggish demand and U.S. shale revival
* Euro in biggest fall this year before recovering
* Euro zone spreads widest in years
(Adds oil price settlement, higher dollar, European close;
By Hilary Russ
NEW YORK, Feb 7 Wall Street pared gains on
declining oil prices, while the dollar climbed to a more than
one-week high on Tuesday on technical buying and political
uncertainty in Europe.
Oil fell with sluggish demand and evidence of a burgeoning
revival in U.S. shale production.
"U.S. shale is coming back, and it's coming back strong,"
said Societe Generale oil analyst Michael Wittner.
U.S. crude oil futures settled 1.58 percent, or 84
cents, lower at $52.17 a barrel. Brent was down 1.17
percent, or 65 cents, at $55.07.
The price moves dragged down U.S. energy shares after the
Dow Jones Industrial Average and the Nasdaq Composite hit
all-time highs just after the market opened.
In late trading, the Dow rose 41.64 points, or 0.21
percent, to 20,094.06, the S&P 500 gained 0.76 points, or
0.03 percent, to 2,293.32 and the Nasdaq Composite added
8.02 points, or 0.14 percent, to 5,671.57.
Fourth-quarter U.S. earnings are estimated to have risen 8.2
percent, the best in nine quarters.
The dollar gained for a fifth straight session, in part
because of "buying by bargain-hunters looking to pick up the
greenback following its worst start to the year in 30 years,"
said to Omer Esiner, chief market analyst at Commonwealth
Foreign Exchange in Washington. The greenback was on track to
post its best one-day gain since mid-December, rising at the
expense of the euro.
The euro fell 0.8 percent to $1.0665, its biggest
fall since Dec. 15, before recovering to $1.0696.
The European currency struggled on renewed concern about
Greece's debt problems and signs that far-right candidate Marine
Le Pen is gaining momentum before France's presidential
The political uncertainty weighed on French stocks, which
slipped as election jitters dampened the country's sovereign
Even so, European shares still closed higher overall, with
the pan-European STOXX 600 index rising 0.32 percent, helped by
Investors also fled French government bonds. Though opinion
polls suggested that Le Pen will not win the second round of the
presidential election in May, such polls have been wrong before,
Rabobank analysts said on Tuesday.
Le Pen has vowed to fight globalization and take France out
of the euro zone.
The premium investors demand for buying French 10-year
government bonds over German 10-year bonds
rose to 78 basis points, the highest level since
November 2012 before easing back a bit. It was 50 basis points
only two weeks ago.
U.S. Treasury yields fell to their lowest in nearly three
weeks, drifting past significant technical levels, as
fixed-income investors worried that President Donald Trump's
pro-growth policies could be hamstrung by his focus on other
The U.S. trade deficit also fell more than expected in
December as exports rose to their highest level in more than
1-1/2 years, outpacing an increase in imports. The dollar gained
4.4 percent against the currencies of the United States' main
trading partners last year.
(Additional reporting by Lucia Mutikani in Washington Dion
Rabouin, Jessica Resnick-Ault and Gertrude Chavez-Dreyfuss in
New York; Yashaswini Swamynathan and Tanya Agrawal in Bengaluru;
Editing by Nick Zieminski and Dan Grebler)