GLOBAL MARKETS-Stocks rise, dollar slips as risk aversion eases

(Adds U.S. market prices)

* U.S. GDP data in Q4 not as bad as full year 2020

* Social-media trading restrictions boost Wall Street

By Herbert Lash and Huw Jones

NEW YORK/LONDON, Jan 28 (Reuters) - The dollar retreated and
Wall Street rallied on Thursday as investors looked past weak
U.S. GDP and jobless claims data to hopes of a rosier economy
ahead and welcomed restrictions on the social media-driven
trading frenzy.

Online trading platforms Robinhood and Interactive Brokers
restricted trading in shares of GameStop, BlackBerry
and other companies that saw hefty gains this week after
they were targeted by an army of retail buyers.

Shares of GameStop plunged about 44% from Wednesday's close,
to $196.14, after hitting $483 earlier in the session. The
shares had traded under $20 at the beginning of the year.

Hedge funds would have had more margin calls if GameStop had
kept going higher, said Thomas Hayes, managing member at Great
Hill Capital LLC in New York.

"When it backed off a little bit, the market breathed a sigh
of relief," Hayes said.

The main Wall Street indexes on Wednesday registered their
sharpest declines in three months after a squeeze on hedge funds
holding short positions in the social-media darlings.

MSCI's benchmark for global equity markets
rose 0.88% to 658.22, while the Dow Jones Industrial Average
rose 2%, the S&P 500 gained 2.00% and the Nasdaq
Composite added 1.5%.

Stocks in Europe traded little changed as countries grappled
with new variants of the coronavirus amid extended lockdowns
that weigh on near-term economic growth. The broad FTSEurofirst
300 index added 0.01% to 1,554.45.

The safe-haven U.S. dollar fell in choppy trading and
riskier currencies, including the Australian dollar, reversed
early losses as stocks rebounded.

U.S. gross domestic product grew at a 4% annualized rate in
the fourth quarter, in line with economists' forecasts, though
for all of 2020 the economy contracted 3.5%, the worst
performance since World War Two.

While GDP contracted over all of last year, data suggested a
faster recovery than many expected. Other reports showed U.S.
jobless claims were lower than expected at 847,000, compared
with forecasts of 875,000.

The dollar index fell 0.161%, with the euro up
0.12% to $1.2122.

The Japanese yen weakened 0.16% versus the greenback
at 104.28 per dollar.

U.S. long-dated Treasury yields rallied from three-week
lows. The U.S. government will auction $62 billion in U.S.
seven-year Treasury notes.

"The Treasury market is operating under the assumption that
we will be hitting a soft patch here in the first quarter," said
Kevin Flanagan, head of fixed income strategy at WisdomTree.
"The numbers are kind of being ignored," he said.

Oil was steady as the impact of a weaker dollar and big U.S.
crude inventory drawdown offset concerns that delays to vaccine
rollouts and fresh travel curbs to prevent new coronavirus
outbreaks could depress demand.

Brent crude futures fell $0.13 to $55.68 a barrel.
U.S. crude futures slid $0.38 to $52.47 a barrel.

Spot gold prices fell -0.15% to $1,841.21 an ounce.

(Reporting by Herbert Lash, additional reporting by Devik Jain
in Bengaluru; Editing by Dan Grebler)