NEW YORK: The dollar strengthened on Thursday and world stocks edged higher, lifting many equity markets to their best performance in at least a decade on signs that a global economic recovery is fully under way.

Oil rose to almost $80 a barrel in thin trade, poised for the biggest annual climb in a decade, a year after posting a huge drop in late 2008 as the worst economic crisis since the Great Depression sapped demand.

US crude for February delivery rose 61 cents to $79.89 a barrel by 12:33 a.m. EST (1733 GMT), its seventh straight session of gains. Prices have risen 14 percent in just over two weeks.

London Brent crude rose 57 cents to $78.60.

Equity markets worldwide glowed. Asia stocks racked up a 68 percent gain for the year, regional European shares climbed 25 percent — their best annual performance since 1999 — and Wall Street was poised for its best year since 2003.

MSCI’s all country world index rose 0.06 percent, and was up almost 32 percent for the year.

US equity markets slipped on Thursday, bucking the day’s global trend, after the December reading of the Institute for Supply Management’s Chicago index was revised downward to 58.7 from the 60.0 level that was reported on Wednesday.

The employment component of the Chicago index was revised to 47.6, below the threshold of 50 that represents expansion, taking some of the boss off the jobless numbers. “The employment revision is concerning and is causing a pall on the markets,” said John Brady, senior vice president at MF Global in Chicago.

“While today’s light volume is exaggerating the importance of this, it’s never good to hear that growth wasn’t as strong as originally reported.”

After midday, the Dow Jones Industrial Average was down 45.80 points, or 0.43 percent, at 10,502.71. The Standard & Poor’s 500 Index was down 3.19 points, or 0.28 percent, at 1,123.23. The Nasdaq Composite Index was down 5.17 points, or 0.23 percent, at 2,286.11.

In Europe, shares climbed as mining stocks tracked firmer metal prices.

Copper rose more than 1 percent to a fresh 16-month high, notching a 139 percent annual increase as fund buying and a looming mine strike in Chile buoyed prices on the last day of 2009.

The FTSEurofirst 300 index of leading European shares rose 0.24 percent to close at 1,045.76 points.

Britain’s leading share index, the FTSE 100, gained 0.3 percent after a subdued half-day trading session on New Year’s Eve, registering a 22 percent increase for 2009, its biggest annualized gain since 1997.

“It has been a belting year. But 2010 is going to be a different kettle of fish and is likely to be a lot more difficult,” said Jim Wood-Smith, head of research at Williams de Broe.

The dollar hit a 3-1/2-month peak against the yen after data showed initial applications for US jobless benefits fell to their lowest level since mid-2008, increasing optimism about the US economy.

The greenback also erased earlier losses against the euro and was headed for its best month against a basket of major currencies since January.

Many analysts see the recent data is a harbinger of strong growth next year and may prompt the Federal Reserve to raise interest rates sooner than expected.

The dollar index is up about 3.5 percent in December, but remains down about 4 percent for the year.

In early afternoon trading, the US Dollar Index, which measures the dollar’s performance against a basket of major currencies, dipped 0.06 percent to 77.871. The euro was down 0.10 percent at $1.4317.

Against the yen, the dollar was up 0.69 percent at 93.10.

Gold was set to post its biggest yearly gain in three decades, rising for an unprecedented ninth consecutive year, as dollar-hedging traders and central banks joined investors who turned to gold for price performance and protection.

Spot gold prices rose $5.20 to $1,096.70 an ounce, after hitting a record high of $1,226.10 on Dec. 3.

The MSCI index of Asia Pacific stocks traded outside Japan rose 1.2 percent in thin trade, marking its best performance since 1993.