Investing.com - Here are the top five things you need to know in financial markets on Monday, May 7:
1. U.S. Crude Tops $70 For First Time Since 2014
Crude prices started the week in an upbeat mood, reaching their strongest level in almost four years as traders increased their bets the U.S. would pull out the Iran nuclear deal, raising the potential for tighter global oil stockpiles.
The Trump administration has until May 12 to decide whether to pull the United States out of a 2015 international accord to curb Iran’s nuclear program and restore sanctions on one of the world's biggest oil producers.
If sanctions are reinstated, that could contribute to tighter global oil inventories, as it would likely result in a reduction of Tehran's oil exports.
Concerns over a deepening economic crisis in Venezuela, which has threatened the country's already tumbling oil supplies was another factor supporting prices.
New York-traded WTI crude futures rose to an intraday peak of $70.69 a barrel, breaching the $70-mark for the first time since November 2014. It was last at $70.47, up 75 cents, or around 1.1%.
Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., tacked on 69 cents, or 0.9%, to $75.56 a barrel, after climbing to $75.89 earlier in the session, its highest since November 2014.
2. U.S. Stock Futures Point To Positive Open
U.S. stock futures pointed to a positive open, as momentum from Friday's tech rally looked set to continue.
The blue-chip Dow futures rose 60 points, or about 0.3%, the S&P 500 futures tacked on 8 points, or nearly 0.3%, while the tech-heavy Nasdaq 100 futures indicated a gain of 42 points, or roughly 0.6%.
U.S. stocks rallied on Friday, as shares of Apple (NASDAQ:AAPL) hit an all-time peak to lead the technology sector higher. The positive numbers on Friday, however, were not enough to offset weekly losses for the Dow and S&P 500, each down roughly 0.2%.
About 40 S&P 500 companies are due to report financial results this week, in what will be the last big wave of the first-quarter earnings season.
NVIDIA (NASDAQ:NVDA), Disney (NYSE:DIS), Groupon (NASDAQ:GRPN), Roku (NASDAQ:ROKU), Office Depot (NASDAQ:ODP), Marriott (NASDAQ:MAR), Electronic Arts (NASDAQ:EA), Wendy’s (NASDAQ:WEN), Etsy (NASDAQ:ETSY), Weibo (NASDAQ:WB), SINA (NASDAQ:SINA), JD.com (NASDAQ:JD), and A-B Inbev (NYSE:BUD) are among some of the names reporting this week.
Elsewhere, in Europe, the continent's major bourses posted slight gains, as companies delivered strong earnings figures, while UK markets were closed for a public holiday, reducing activity.
Earlier, in Asia, markets in the region closed mostly higher, after U.S. stocks rallied Friday on a solid April jobs report.
3. Dollar Stays Near 2018 Highs
The dollar ticked higher against a basket of currencies, staying near its 2018 peak after U.S. jobs and wages data did little to temper perceptions of strength in the U.S. economy.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was up around 0.2% at 92.61, not from Friday's high of 92.75, its strongest level since late December.
The dollar was trading at 109.35 against the yen, nearing its three-month high of 110.05 touched last week.
Elsewhere, the euro changed hands at 1.1928, within sight of Friday's four-month low of 1.1910, while the British pound traded at 1.3540, near its four-month low of 1.3487 touched last week.
Demand for the dollar continued to be underpinned by bets that the Federal Reserve will continue raising rates while other central banks, including the European Central Bank and the Bank of England, will act more slowly as recent economic figures there suggest cooling momentum.
4. Fed Speakers Eyed For Rate Hikes Hints
Markets will pay close attention to comments from several Fed speakers today for their views on inflation trends as traders watch for clues on the pace of future rate hikes this year
Atlanta Fed boss Raphael Bostic will deliver opening remarks at the Federal Reserve Bank of Atlanta's 23rd Annual Financial Markets Conference, in Florida at 8:25AM ET (1225GMT).
Richmond Fed President Thomas Barkin is due to speak at George Mason University in Virginia at 2PM ET (1800GMT).
Dallas Fed chief Robert Kaplan and Chicago Fed President Charles Evans will then take part in a panel discussion at the Atlanta Fed Financial Markets Conference at 3PM ET (1930GMT).
The Fed kept interest rates unchanged following its policy meeting last week, a move that was widely expected, and noted that inflation was starting to inch higher, leaving it on track to raise borrowing costs in June.
The U.S. central bank currently forecasts two more rate hikes in 2018, although market expectations of a third move higher before the end of the year has been gaining momentum in recent weeks amid strengthening inflation prospects.
5. NAFTA Talks Resume
Ministers from the United States, Canada and Mexico will gather again in Washington on Monday to begin what government officials and industry leaders hope is the final leg of negotiations over the North American Free Trade Agreement (NAFTA).
Discussions will center on rules of origin that govern what percentage of a car needs to be built in the NAFTA region to avoid tariffs, the dispute-resolution mechanism and U.S. demands for a sunset clause that could automatically kill the trade deal after five years.
Sources close to the talks have suggested there is a creeping feeling of uncertainty and pessimism going into the new round because of gridlock on the most critical issues.