1. Saudi Arabia, Russia back 9-month extension to OPEC output deal
Saudi Arabia and Russia, the world’s two top oil producers, agreed on Monday to extend oil output cuts for a further nine months until March 2018 in a bid to erode a global crude glut.
In a joint statement that followed an earlier meeting in Beijing, Saudi energy minister Khalid al-Falih and his Russian counterpart Alexander Novak said they had agreed to prolong an existing deal by another nine months until March 2018.
The timing of the announcement ahead of OPEC’s next official meeting on May 25 and the statement’s strong wording sparked a sharp rally in crude prices.
U.S. crude jumped to a two-week high of $49.09 a barrel, up $1.26, or around 2.6%, while Brent gained $1.30 to $52.14, the highest level since May 2.
2. Cyberattack spreads, though at slower pace
Cybersecurity experts said the spread of a ransomware worm dubbed WannaCry had slowed on Monday, but that the respite might only be brief as more people around the world return to work and turn on their computers.
The cyberattack, which lock up computer systems until the victims pay a ransom, has infected more than 200,000 computers in more than 150 countries over the weekend.
Microsoft (NASDAQ:MSFT) on Sunday pinned blame on the U.S. government for not disclosing more software vulnerabilities.
Among the highest-profile corporate victims were, French car manufacturer Renault (PA:RENA) and Spain’s Telefonica (MC:TEF).
3. North Korea carries out another missile test
Market participants kept a wary eye on developments in North Korea, which successfully conducted a newly developed mid-to-long range missile test on Sunday aimed at verifying the capability to carry a “large scale heavy nuclear warhead.”
The test was a significant advance in North Korea’s drive for an intercontinental ballistic missile capable of carrying a nuclear warhead and reaching the U.S. mainland.
The United Nations Security Council is due to meet on Tuesday to discuss North Korea’s latest missile launch, diplomats said on Sunday, which was requested by the U.S. and allies South Korea and Japan.
4. China’s economy loses momentum in April
China’s growth took a step back in April after a surprisingly strong start to the year, as factory output to investment to retail sales all tapered off as authorities clamped down on debt risks in an effort to stave off a potentially damaging hit to the economy.
Factory output was up 6.5% in April from a year earlier, down from 7.6% in March, and fixed-asset investment rose 8.9% in the first four months of the year, off the 9.2% in preceding four-month period.
Analysts had predicted factory output would grow by 7.1% in April, and tipped fixed asset investment to rise 9.1%.
Meanwhile, Chinese President Xi Jinping over the weekend pledged $124 billion in fresh financing to support its “Belt and Road” infrastructure mega-program.
5. Global stocks rise to multi-year highs as investors shrug off risks
Global stock markets rose on Monday, as investors shrugged off another missile test by North Korea and threats from a cyberattack that spread around the globe at the weekend.
Most Asian indexes closed higher, with MSCI’s broadest index of Asia-Pacific shares outside Japan (NYSE:EPP) rising around 0.3% to its highest level since June 2015, while MSCI’s emerging markets benchmark (NYSE:EEM) advanced 0.4% to a two-year high.
In Europe, stocks across the continent were mostly in positive territory in mid-morning trade, with London’s FTSE 100 and Germany’s DAX scaling fresh record highs.
On Wall Street, the blue-chip Dow futures inched up 44 points, or around 0.2%, the S&P 500 futures added 3 points, while the tech-heavy Nasdaq 100 futures were little changed.
On the data front, Monday’s calendar features a survey on manufacturing conditions in the New York region at 8:30AM ET (12:30GMT). Shortly afterwards, the NAHB housebuilder sentiment survey is due at 10AM ET.
Markets are pricing in around a 70% chance of a hike at the Fed’s June meeting, according to Investing.com’s Fed Rate Monitor Tool.