* Nuclear deal reached between Iran, global powers
* Oil prices gain, reversing losses
* European, U.S. energy shares rally
* Weak U.S. retail sales hurt dollar
* U.S. Treasuries yields slip on U.S. data (Adds close of European markets)
By Sam Forgione
NEW YORK, July 14 (Reuters) - Stock markets worldwide rose modestly on Tuesday after a landmark nuclear deal between Tehran and six global powers left sanctions on Iran in place for now, spurring gains in energy shares, while expectations for weak corporate results capped U.S. share gains.
Brent and U.S. crude reversed losses which came after the nuclear deal was reached. The deal, which is set to ease sanctions against Tehran and allow a gradual rise in its oil exports, had sent oil prices tumbling.
Brent crude was last up 81 cents, or 1.4 percent, at $58.66 a barrel. U.S. crude was up $1.02, or 1.95 percent, at $53.22 per barrel. The rebound boosted the S&P energy index, which was last up 0.66 percent at 545.24, while the STOXX 600 Europe Oil & Gas Index closed up 0.84 percent at 312.68.
“The market was short going into the Iran agreement, but the bears did not get the sell-off they were hoping (for), so we’re going back up,” said Scott Shelton, commodities specialist and crude broker with ICAP in Durham, North Carolina.
Expectations for weak corporate earnings reports and data showing disappointing June retail sales in the United States, along with a decline in shares of carmakers in Europe, capped equities gains. The decline in carmakers occurred as JP Morgan cut forecasts for the Chinese auto market.
U.S. companies are expected to report their worst sales declines in nearly six years when they post second-quarter results, while earnings are expected to have fallen 2.9 percent, according to Thomson Reuters estimates.
MSCI’s all-country world stock index, which tracks shares in 45 nations, was last up 2.23 points, or 0.52 percent, at 429.42.
The Dow Jones industrial average was last up 62 points, or 0.34 percent, at 18,039.68. The S&P 500 was up 7.91 points, or 0.38 percent, at 2,107.51. The Nasdaq Composite was up 33.14 points, or 0.65 percent, at 5,104.65.
The pan-European FTSEurofirst 300 index closed up 0.53 percent, at 1,580.34.
U.S. Treasury yields, which move inversely to prices, edged lower after the unexpected drop in U.S. June retail sales added to speculation that tepid economic data may push back when the Federal Reserve is likely to begin raising interest rates.
Benchmark 10-year U.S. Treasury notes were last up 7/32 in price to yield 2.40 percent, from a yield of 2.43 percent late on Monday. The data increased focus on Fed Chair Janet Yellen’s Humphrey-Hawkins testimony to Congress on Wednesday and Thursday.
“It certainly doesn’t help the cause. Everyone seemed to get a bit more bearish after Yellen made her comments on Friday, people are anticipating kind of the same tone going into tomorrow,” said Tom Tucci, head of Treasuries trading at CIBC in New York.
The retail sales data also halted Monday’s rally in the dollar. The dollar index, which measures the greenback against a basket of six major currencies, was last down 0.17 percent at 96.690.
Spot gold prices were last down $2.84 at $1,154.76 an ounce. (Additional reporting by Nigel Stephenson in London, Michael Connor and Karen Brettell in New York, and Tanya Agrawal in Bangalore; Editing by Meredith Mazzilli and Jonathan Oatis)