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GLOBAL MARKETS-Oil surges to over two-year peak; shares little changed

Published 2017-11-06, 11:57 a/m
© Reuters.  GLOBAL MARKETS-Oil surges to over two-year peak; shares little changed
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* Graphic: World FX rates in 2017 http://tmsnrt.rs/2egbfVh

* Oil jumps to over 2-year high

* Nasdaq hits new record high; dollar in tight range (Updates with U.S. market open; changes dateline and byline)

By David Randall

NEW YORK, Nov 6 (Reuters) - Oil prices surged to their highest since July 2015 on Monday as Saudi Arabia's crown prince cemented his power with a crackdown on corruption, while world shares were little changed and key currencies stayed in tight ranges.

U.S. crude CLc1 broke above $56 a barrel for the first time in more than two years as Mohammed bin Salman's clampdown on graft led to arrests of royals, ministers and investors including prominent billionaire investor Alwaleed bin Talal. O/R Mohammed's reforms include a plan to list parts of giant state-owned oil company Saudi Aramco next year, with higher oil prices seen as beneficial for the market capitalisation of the future listed company.

The news spurred concerns of Middle Eastern money pulling out of global financial markets. A weekend call by China's central bank governor for tougher financial regulation also hit global investor sentiment. MSCI world equity index, which tracks shares in 47 countries was little changed, adding just 0.05 percent. .MIWO00000PUS

The pan-European STOXX 600 .STOXX was 0.2 percent higher. Saudi Arabia's own stock market fell as much as 1.5 percent before ending 0.1 percent higher, boosted in part by buying by government-linked funds. EMRG/FRX

Sentiment towards the U.S. dollar was still positive with leveraged funds paring bearish bets to be net long for the first time since late July. IMM/FX

"There is some ongoing adjustment in market expectations on the dollar's outlook on the progress of the U.S. tax bill and on the ongoing Saudi situation but market moves have been in narrow ranges," said Alberto Gallo, head of macro strategies at Algebris Investments in London.

NASDAQ AT PEAK

Two key Wall Street equity indexes were little changed in early trading, with investors focused on what could be the biggest merger in the technology sector.

The tech-heavy Nasdaq Composite Index .IXIC. hit a new record high above 6,765.1238 level on news that chip maker Broadcom Ltd AVGO.O made an unsolicited bid to buy peer Qualcomm Inc QCOM.O for $103 billion. market was otherwise flat. The Dow Jones Industrial Average .DJI rose 3.65 points, or 0.02 percent, to 23,542.84, while the S&P 500 .SPX gained 1.45 points, or 0.06 percent, to 6,780.37.

The U.S. dollar was little changed after investors took profits on its best weekly performance this year, with wariness about the status of the U.S. economy and tax reform plans setting the tone.

Facing pockets of discontent in their own Republican ranks, tax negotiators in the U.S. House of Representatives will seek to bridge differences over their far-reaching tax bill and stick to a self-imposed deadline of passage this month. index that measures the greenback against a basket of currencies .DXY rose 0.04 percent, with the euro EUR= down 0.19 percent to $1.1585.

The Japanese yen weakened 0.05 percent versus the greenback at 114.13 per dollar, while Sterling GBP= was last trading at $1.3121, up 0.36 percent on the day.

The spread between two-year and 10-year U.S. yields was at the narrowest in more than a decade as sluggish domestic inflation underpinned demand for longer-maturity government bonds. US2YT=TWEB US10YT=TWEB

Treasuries Benchmark 10-year notes US10YT=RR last rose 5/32 in price to yield 2.3253 percent, from 2.343 percent late on Friday.

The 30-year bond US30YT=RR last rose 12/32 in price to yield 2.8035 percent, from 2.822 percent late on Friday.

Spot gold XAU= was up 0.24 percent at $1,272.04 an ounce.

For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Global assets in 2017

http://reut.rs/1WAiOSC Global currencies vs. dollar

http://tmsnrt.rs/2egbfVh Global bonds dashboard

http://tmsnrt.rs/2fPTds0 Emerging markets in 2017

http://tmsnrt.rs/2ihRugV

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Bernadette Baum)

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