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Global stocks tick up to record high, oil stumbles

LiveMint logoLiveMint 07-08-2017 Reuters

New York: A broad measure of equity markets across the world climbed to a record high on Monday, boosted by gains in Asia, while US and European markets were little changed, with US energy shares weighing on the benchmark S&P 500 index as crude prices fell.

Oil prices have been pressured over the past several days after hitting their highest since May last week, as OPEC exports hit a record peak last month and output rose to a 2017 high.

Strong economic data globally and healthy corporate earnings in the United States have supported equities, with the Dow industrials closing Friday at its eighth consecutive record high.

“I have seen a lot of companies exceeding their revenue growth and we also have better-than-expected global growth, which are the main drivers for equities,” said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

The Dow Jones Industrial Average rose 8.24 points, or 0.04%, to 22,101.05, the S&P 500 gained 1.43 points, or 0.06%, to 2,478.26 and the Nasdaq Composite added 26.92 points, or 0.42%, to 6,378.48.

MSCI’s gauge of stocks across the globe gained 0.20%. The pan-European FTSEurofirst 300 index lost 0.14%.

Emerging market stocks gained 0.65%. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.5% higher, while Japan’s Nikkei rose 0.52%.

Oil prices fell, with energy markets focused on comments from OPEC and non-OPEC officials who are meeting in Abu Dhabi to discuss ways to boost compliance with a deal to cut output.

US crude fell 1.63% to $48.77 per barrel and Brent was last at $51.64, down 1.49% on the day.

“The market is looking for comment from Saudi Arabia signaling OPEC will meet its agreed target,” Hans van Cleef, senior energy economist with ABN AMRO, said. “The possibility for (price) movement seems limited unless OPEC comes out with a statement.”

In currency markets, the US dollar edged lower but held on to most of its Friday gains, as investors await inflation data this week that may signal a turnaround in the greenback’s weakness so far this year.

“We have a view that the US dollar is due for some mild corrective strength in the near-term and we see some confirming price action from some of the key G10 currency pairs,” said Erik Nelson, currency strategist at Wells Fargo Securities in New York.

“Some of these dollar-bloc currencies are starting to show signs of maybe rolling over in the near-term.”

The dollar index fell 0.07%, with the euro up 0.15% to $1.1786.

The Japanese yen weakened 0.08% versus the greenback at 110.77 per dollar, while sterling was last trading at $1.3019, down 0.12% on the day.

In the absence of major US economic data, the Treasuries market was little changed and focused on a heavy schedule of government and corporate bond issues this week, which could push yields higher.

Benchmark 10-year notes last rose 3/32 in price to yield 2.2584%, from 2.269% late on Friday.

The 30-year bond last rose 4/32 in price to yield 2.8374%, from 2.844%.

Spot gold added 0.1% to $1,259.60 an ounce. US gold futures gained 0.05% to $1,265.20 an ounce.

Copper rose 0.59% to $6,409.50 a tonne.

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