U.S. Stocks Up on Energy, Mining Companies

By Riva Gold Features Dow Jones Newswires

U.S. stocks rose Monday as a jump in commodities prices boosted shares of energy and mining companies.

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The Dow Jones Industrial Average gained 71 points, or 0.3%, to 20968. The S&P 500 rose 0.4%, and the Nasdaq Composite added 0.4%.

U.S. crude oil rose 2.7% to $49.13 a barrel after top energy officials in Saudi Arabia and Russia said they would back a nine-month extension to a production-cut deal led by the Organization of the Petroleum Exporting Countries.

"We have, before coming to this announcement today, reached out to many of our colleagues within and outside OPEC, and I think there is general consensus that this is the right approach and the right thing to do," Saudi Arabia's energy minister Khalid al-Falih said.

Optimism about the extended oil production cuts spanned the sector. Energy stocks in the S&P 500 climbed 1.2%, with Transocean, Marathon Oil and Halliburton among the best performers.

The Stoxx Europe 600 rose less than 0.1%, buoyed by a 0.9% climb in the oil and gas sector -- the only one in negative territory for the year.

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Shares of miners also advanced on gains in base metals prices after Chinese President Xi Jinping pledged more than $100 billion in new financing as part of a mega-infrastructure project.

Shares of Symantec, a maker of antivirus software, climbed 3.8% after a global cyberattack hit computers around the globe. Moves in traditional safe haven assets, including government bonds, gold and the yen, were muted.

In currencies, the euro rose 0.4% against the dollar to $1.0980. Speculative euro positions surged into positive territory for the first time since May 2014, according to the most recent CFTC data, as investors drew encouragement from French election results and improving economic data.

The WSJ Dollar Index edged down 0.3% after falling Friday on slightly weaker-than-expected inflation and retail sales reports.

The yield on the benchmark 10-year U.S Treasury note was little changed Monday at 2.337%, according to Tradeweb, from 2.331% Friday. Yields move inversely to prices.

Still, investors continue to bet the economy will be strong enough for the Federal Reserve to raise interest rates in June. Fed-funds futures tracked by CME Group, which are used by investors to bet on central bank policy, currently suggest a 74% chance of a rate rise next month, down from 83% a week ago.

"More recent figures haven't been great, but certainly this year we've had fairly strong [economic] numbers out," said Paul Flood, multiasset manager at Newton Investment Management.

"As long as you've got economic growth, you tend to favor equities or equity-like instruments over bonds," he said.

Earlier, Chinese stocks and bonds rose amid signs Beijing will take a softer approach to reducing leverage and preventing risks in the debt-laden financial system.

The Shanghai Composite gained 0.2% despite data showing China's economic activity weakened more than expected last month. Value-added industrial output, a rough proxy for growth, rose by 6.5% in April from a year earlier, well below economists' forecasts.

Hong Kong's Hang Seng Index rose 0.9% amid gains in companies based in mainland China and Friday's release of better-than-expected first-quarter economic growth. Chinese technology giant Tencent Holdings continued to help the index hit a series of 22-month highs.

Gunjan Banerji,

Kenan Machado

,

Shen Hong

and Neanda Salvaterra contributed to this article.

Write to Riva Gold at riva.gold@wsj.com

U.S. stocks rose Monday as a jump in commodities prices boosted shares of energy and mining companies.

The Dow Jones Industrial Average gained 100 points, or 0.5%, to 20997. The S&P 500 rose 0.5%, and the Nasdaq Composite added 0.4%.

U.S. crude oil rose 2.7% to $49.16 a barrel after top energy officials in Saudi Arabia and Russia said they would back a nine-month extension to a production-cut deal led by the Organization of the Petroleum Exporting Countries. Saudi Arabia's Energy Minister Khalid al-Falih and Russian Energy Minister Alexander Novak said the pact s hould continue until the end of March 2018.

"A lot of the imbalances that we saw in the crude oil markets are beginning to stabilize," said Bruce Bittles, chief investment strategist at Baird. The prospect of oil production coming closer in line with consumption has led to this "relief rally in oil," he said.

Energy stocks in the S&P 500 climbed 1%, with Transocean, Marathon Oil and Halliburton among the best performers.

The Stoxx Europe 600 rose less than 0.1%, buoyed by a 0.9% climb in the oil and gas sector -- the only one in negative territory for the year.

Shares of mining companies also advanced on gains in base metals prices after Chinese President Xi Jinping pledged more than $100 billion in new financing as part of a mega-infrastructure project.

Shares of Symantec, a maker of antivirus software, climbed 3.5% after a global cyberattack hit computers around the globe. Moves in traditional safe haven assets, including government bonds, gold and the yen, were muted.

In currencies, the euro rose 0.4% against the dollar to $1.0980. Speculative euro positions surged into positive territory for the first time since May 2014, according to the most recent CFTC data, as investors drew encouragement from French election results and improving economic data.

The WSJ Dollar Index edged down 0.2%.

The yield on the benchmark 10-year U.S. Treasury note rose to 2.348%, according to Tradeweb, from 2.331% Friday. Yields move inversely to prices.

Investors continue to bet the economy will be strong enough for the Federal Reserve to raise interest rates in June. Fed-funds futures, which are used by investors to bet on central bank policy, currently suggest a 74% chance of a rate rise next month, down from 83% a week ago, according to the CME Group.

"More recent figures haven't been great, but certainly this year we've had fairly strong [economic] numbers out," said Paul Flood, multiasset manager at Newton Investment Management.

"As long as you've got economic growth, you tend to favor equities or equity-like instruments over bonds," he said.

Write to Riva Gold at riva.gold@wsj.com

(END) Dow Jones Newswires

May 15, 2017 14:10 ET (18:10 GMT)