U.S. Stocks Rise as Oil Advances, Dollar Weakens: Markets Wrap

(Bloomberg) -- U.S. stocks advanced for a third day as President Donald Trump’s trip to Saudi Arabia netted deals that lifted industrial shares and crude pushed to a one-month high before OPEC meets this week. The dollar slipped.

The S&P 500 Index’s three-day climb topped 1.5 percent as Boeing Co. jumped after Trump’s foreign trip overshadowed a week of tumult in Washington. The euro advanced after Chancellor Angela Merkel said the “too weak” currency shared the blame for Germany’s trade surplus. The 10-year Treasury yield edged toward 2.25 percent. Brazilian assets resumed a selloff Monday as investors fled what had been one of the most popular trades in emerging markets.

A risk-on tone returned to financial markets a week after near daily political tumult in Washington and Brazil rattled investors. The focus reverted back to speculation that global growth can weather the turmoil, even as the world’s largest economy edges closer to another increase in borrowing costs. Money managers will be scrutinizing minutes released this week from the Federal Reserve’s latest meeting.

Trump has so far managed to divert attention from the domestic crisis surrounding former FBI Director James Comey as he travels in the Middle East, where U.S. companies have signed multi-billion dollar deals in the defense, energy and infrastructure industries, before continuing on to Europe.

“With Trump on a tour, the hope is we see less news over the next couple of days -- a chance for the waters to settle,” said Andrew Sullivan, a managing director for sales trading at Haitong International Securities Group Ltd. in Hong Kong. “It’s another overhang on the market. We’ve got all these markets trading at highs and people don’t want to miss out, but they don’t want to be caught out.”

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Here are the key events for investors this week:

• Donald Trump heads to the Group of Seven and NATO meetings in Europe.
• Euro-area finance ministers discuss Greece’s bailout program, also on Monday.
• The Trump administration will release its budget request on Tuesday.
• Minutes from the May 3 Fed policy meeting will be released Wednesday.
• A key OPEC decision will be made in Vienna on Thursday.
• South Korea, Canada, South Africa and Thailand set interest rates.

And here are the main movers:

Stocks 

• The S&P 500 rose 0.5 percent to 2,393.97 as of 4 p.m. in New York. The index has climbed 1.6 percent in three days following a 1.8 percent rout last Wednesday and sits just 0.4 percent from an all-time high.
• Boeing jumped 1.6 percent and 3M Co. advanced to lead gains in the Dow Jones Industrial Average.
• The Stoxx Europe 600 Index fell 0.1 percent following the worst week since November.
• Emerging market stocks jumped 0.9 percent

Commodities

• West Texas Intermediate oil climbed 0.8 percent to settle at $50.73 per barrel, extending a 2 percent advance Friday.
• Gold futures gained 0.6 percent to close at $1,261.40 an ounce. The metal jumped 2.2 percent last week.

Currencies 

• The dollar was lower versus most of its G-10 peers with the Bloomberg dollar index extending losses to about 0.2 percent. The measure is coming off its worst week since July.
• The euro added 0.3 percent to $1.1234 after earlier dropping as much as 0.4 percent. The pound lost 0.3 percent to $1.2997.
• The Russian ruble strengthened 0.3 percent.

Bonds

• Ten-year Treasury yields were higher by two basis points to 2.25 percent. The rate tumbled last week by nine basis points.
• French and German yields climbed four basis points and three basis points respectively.

--With assistance from Samuel Potter Dennis Pettit Paula Sambo and Mark Shenk

To contact the reporter on this story: Jeremy Herron in New York at jherron8@bloomberg.net.

To contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, Robert Brand