By Saqib Iqbal Ahmed
NEW YORK (Reuters) - World stocks advanced on Tuesday while the U.S. dollar was near a four-week low against a basket of currencies, a day after Federal Reserve Chair Janet Yellen expressed confidence in the health of the U.S. economy but offered no fresh hints on the timing of the next interest rate hike.
The MSCI world equity index (MIWD00000PUS), which tracks shares in 45 nations, rose to the highest in more than five weeks, and oil prices climbed to a 2016 peak, buoyed by the softer dollar and supply worries.
The dollar ticked up slightly after U.S. Labor Department said nonfarm productivity fell less sharply than was reported in the first quarter, but dropped back near a low hit on Monday.
The Labor Department said productivity, which measures hourly output per worker, contracted at an annualized rate of 0.6 percent, instead of the 1.0 percent pace reported last month.
Strength in oil prices bolstered energy shares, which led gains on Wall Street.
"There is a good possibility we may see the S&P make a new 52-week high as enthusiasm continues to build," said Peter Cardillo, chief market economist at First Standard Financial in New York.
The Dow Jones industrial average (DJI) was up 61.06 points, or 0.34 percent, at 17,981.39, the S&P 500 (SPX) rose 5.34 points, or 0.25 percent, at 2,114.75 and the Nasdaq Composite (IXIC) was up 5.19 points, or 0.1 percent, at 4,963.53.
Europe's broad FTSEurofirst 300 index (FTEU3) was up 0.51 percent at 1,358.82, taking cues from Yellen's remarks Monday and helped by improving sentiment due to firmer oil prices.
The MSCI world equity index (MIWD00000PUS) was up 0.63 percent, on pace for its fourth session of gains.
Oil prices hit their highest in eight months amid falling Nigerian oil output after a spate of attacks on infrastructure.
The price of oil has nearly doubled since January, boosted largely by a spate of unplanned outages that have eroded production in Canada, Venezuela, Libya and Nigeria, along with a steady decline in higher-cost U.S. shale output.
Brent crude (LCOc1) was last up 1.03 percent at $51.07 a barrel, while U.S. crude (CLc1) was last up 0.8 percent at $50.09 per barrel.
In the currency market, the Australian dollar strengthened on Tuesday after the Reserve Bank of Australia kept interest rates on hold and hinted it was in no hurry to ease monetary policy further on signs of reasonably strong economic growth.
The Aussie was the biggest gainer among major currencies, hitting $0.7458, its highest since May 6
The dollar index (DXY), which measures the greenback against a basket of six major rivals, was last down 0.02 percent to 93.887.
In the bond market, U.S. Treasuries were steady as the government was due to sell $24 billion in three-year notes on Tuesday, the first sale of $56 billion in new coupon-bearing supply this week.
Benchmark 10-year notes (US10YT=RR) were last up 1/32 in price to yield 1.719 percent, down a touch from 1.723 percent late on Monday. The yields have risen from two-month lows of 1.697 percent on Friday, after the weak jobs report.
Gold eased as investors turned cautious after the metal failed to sustain a recent rally. Spot gold prices