Dollar rebounds, European stocks up

The US Dollar Index recovered from an earlier loss to extend Monday's gain, while European equities advanced after Asian markets and crude oil rose on the first full trading day of the New Year. A private factory gauge indicated strength in China's economy.

The dollar was at its strongest against the yen since Dec 21 and highest versus the Turkish lira in a month. However, it remained weaker against currencies including the Australian and New Zealand dollars and the British pound.

Australia's benchmark index touched the highest level in one-and-a-half years and the Shanghai Composite Index gained. Oil traded above $54 a barrel as OPEC member Kuwait cut output and gold advanced for a fifth time in six sessions. The yield on 10-year US Treasuries rose 3 basis points to 2.479 percent.