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May 15, 2017

European and U.S. Summary Markets Closing Reports on May 15, 2017

Carla Mozee

European equity-index gauges finished with modest gains Monday, scoring a fillip from commodity shares as oil and metals prices rose.
The Stoxx Europe 600 index SXXP, +0.09% ended up 0.1% at 395.97, marking a second straight advance and keeping the index around its highest since August 2015. But the index moved between small gains and losses throughout the session.
The oil-and-gas, basic-materials and financial sectors fared the best, but health-care, consumer-related and telecom shares struggled.
Commodities cruise up: The Stoxx Europe 600 Oil & Gas Index SXEP, +0.93%  climbed 0.9%. It was bolstered by intraday gains of 3% for Brent LCON7, +1.73%  and U.S. crude prices CLM7, +1.94% after Saudi Arabian and Russian energy ministers said they back a nine-month extension to a production cut deal led by the Organization of the Petroleum Exporting Countries—proposing a longer extension than expected.
Separately, China’s President Xi Jinping on Sunday pledged more than $100 billion in fresh financing to support its “One Belt, One Road” infrastructure program. Metals prices rose, with silver futures SIN7, +1.30%  packing on more than 1%.
Mining stocks rose as well, leaving the Stoxx Europe 600 Basic Resources Index SXPP, +1.65%  up 1.7%, the biggest rise since May 5.
“When oil rises and China opens its [check] book, this helps to lift risk sentiment and acts as a soothing balm, even though geopolitical risks are rising after frequent cyber attacks all over the world and North Korea tested its most advanced missile over the weekend,” wrote Kathleen Brooks, research director at City Index.
Read: cyberattack set to spread again Monday, experts fear
And see: North Korea’s ballistic-missile launch viewed as challenge to new president in South
In the oil group, producers Tullow Oil PLC TLW, +3.08%  and Statoil ASA STL, +2.13%  ended 3.1% and 2.1%, respectively. OMV AG OMV, +6.69% leapt 7.3% after Barclays raised its rating on the integrated oil-and-gas company.
Among miners, Antofagasta PLC  ANTO, +2.26%  claimed a 2.3% rise and BHP PLC BLT, +2.28% BHP, +1.42% BHP, +0.29%  tacked on 2.3%. Steel pipe maker Tenaris TEN, +2.18%  moved up 2.2%.
Advances for oil and metals shares lifted the U.K.’s FTSE 100 UKX, +0.26% by 0.3% to end at a record close of 7,454.37.
See: BHP drops the “Billiton’ in rebranding effort
Stock movers: Atlantia Spa shares ATL, +2.48%  rose 2.5% after the Italian infrastructure group launched a $17.8 billion cash-and-share offer for Spain’s Abertis SA ABE, -0.61%  that could create the world’s biggest toll-road operator. Abertis shares fell 0.6%.
RWE AG RWE, +3.75%  picked up 3.9% after the German utility backed its full-year outlook and said it’s on track to pay a dividend of 50 euro cents a share in 2017. RWE hasn’t paid a dividend since 2015.
Sophos Group PLC SOPH, +7.27%  jumped 7.3% on the FTSE 350 Index NMX, +0.20% That moved helped the ISE Cyber Security ETF ISPY, +3.25% rise 3.3%, as experts flagged the possibility of another massive cyberattack. More than 200,000 computers in at least 150 countries were paralyzed last week by the so-called “WannaCry” malicious software.
TUI AG TUI, -4.79%  dropped 4.8% after the travel services company posted a slightly wider first-half adjusted loss of $251.9 million euros ($273.9 million).
Indexes: RWE’s rise contributed to Germany’s DAX 30 index DAX, +0.29%  ending at a record, rising by 0.3% to 12,807.04, adding to a recent run of records for the index.
France’s CAC 40 PX1, +0.22% rose 0.2% to 5,417.40.
The euro EURUSD, +0.4117%  traded at $1.0975, up from $1.0932 late Friday in New York.
Read: The ECB has 3 big reasons to wind up QE—here’s why it shouldn’t


Sue Chang, Anora Mahmudova

Higher oil prices are lifting investors’ spirits on Monday.
The S&P 500 and the Nasdaq Composite closed at fresh records on Monday as a jump in oil prices to a two-week high lifted Wall Street sentiment.
The S&P 500 index SPX, +0.48%  added 11.42 points, or 0.5%, to finish at 2,402.32. The Nasdaq Composite Index COMP, +0.46%  gained 28.44 points, or 0.5%, to end at 6,149.67.
The Dow Jones Industrial Average DJIA, +0.41%  rose 85.33 points, or 0.4%, to close at 20,981.94. Cisco Systems Inc. CSCO, +2.33%  and Johnson & Johnson JNJ, +2.71%  were the top performers, both gaining more than 2%.
“The move upward is particularly interesting since the [Empire State] manufacturing report was disappointing,” said Colin Cieszynski, chief market strategist at CMC Markets, referring to a measure of activity in New York state.
Crude-oil prices CLM7, +2.05% settled 2.1% higher after energy ministers from Saudi Arabia and Russia said in a joint statement that they endorse a nine-month extension to current production cuts — three months longer than expected.
The proposed extension still needs to be confirmed when the 13 members of the Organization of the Petroleum Exporting Countries gather for a closely watched meeting in Vienna on May 25.
“The picture in oil market did not change at all. We are still dealing with a lot of supply and the U.S. is a swing supplier. Whenever oil reaches a certain price, U.S. producers enter the market,” said Maris Ogg, president at Tower Bridge Advisors.
“However, it appears oil prices are no longer impacting earnings. The first-quarter earnings were good and the labor market is holding up, with a possible labor crunch coming. With this backdrop, we would want to stay invested in stocks,” Ogg said.
Cieszynski, meanwhile, cautioned against reading too much into the market’s move higher.
“Despite the gains, the S&P is still struggling with 2,400 and the Dow has remained unable to regain 21,000. We’re still just at the start of the seasonally weaker half of the year for stocks and I’m still of the mind that the rally which started back in November may be running on fumes,” he said.
Geopolitical uncertainty also continues to hang over the market. North Korea over the weekend tested another ballistic missile over the Sea of Japan on Sunday, seen as a direct challenge to the newly elected president of South Korea, Moon Jae-in.
Stock movers: Shares of cybersecurity companies advanced as the “WannaCry” virus was expected to continue to wreak havoc. Shares of Symantec Corp. SYMC, +3.19% rose 3.2%, Palo Alto Networks Inc. PANW, +2.70%  gained 2.7% and FireEye Inc. FEYE, +7.51% surged 7.5%. The PureFunds ISE Cyber Security ETF HACK, +3.19%  rose 3.2%.
Patheon NV PTHN, +33.08%  soared 33% after Thermo Fisher Scientific Inc. TMO, +0.43%  said it was buying the company for $7.2 billion including $2 billion of net debt.
Moody’s Corp. MCO, +1.17%  said it would buy Dutch business-intelligence firm Bureau van Dijk for €3 billion, or around $3.27 billion. Shares rose 1.2%.
Shares of Alphabet Inc. GOOGL, +0.43% GOOG, +0.52%  gained 0.4% after Waymo LLC, the driverless-car division of the Google parent, and ride-hailing startup Lyft Inc. said Sunday they would work together to develop autonomous vehicle technology.
The announcement is seen as another potential blow to rival Uber Technologies Inc., just as the company is headed for a court battle with Alphabet over a key technology for self-driving cars.
Economic news: A gauge of New York-area manufacturing slumped into negative territory for the first time since the presidential election. The Empire State manufacturing index for May fell to negative 1, from positive 5.2 in April.
Separately, sentiment among home builders rebounded in May, buoyed by optimistic views of demand for housing.
Other markets: European stock markets were up across the board and stocks in Asia closed mostly higher, with investors largely ignoring a batch of disappointing Chinese data and instead focusing on China’s “One Belt, One Road” infrastructure program.
China’s President Xi Jinping over the weekend said there will be more than $100 billion in fresh financing in support for the initiative, a bid to link regions via infrastructure projects that is seen as a bid to reshape the geopolitical world order by casting China as the protector of globalization.
The project helped lift metals, with gold GCM7, +0.23%  up 0.2% and silver SIN7, +1.33%  adding 1.2% while copper HGN7, +0.53%  gained 0.6%.
The dollar DXY, -0.32%  traded lower against most other major currencies and the yield on the 10-year Treasury note TMUBMUSD10Y, +0.79%  edged up to 2.34%.
—Sara Sjolin contributed to this report.