* Oil jumps on Saudi-Russia comment on output
* Aussie, Canadian dollars hit two-week highs
* Worries over cyber attack relegated to background
* Gains for European stock markets limited
* Graphic: World FX rates in 2017 tmsnrt.rs/2egbfVh
By Patrick Graham
LONDON, May 15 A bounce in oil and other
commodities prodded stock markets higher on Monday, cushioning
the hit to sentiment from a successful missile test by North
Korea and a cyber attack that locked 200,000 computers in more
than 150 countries.
In Europe, another victory for Angela Merkel's conservatives
in a regional election in Germany also helped share indices in
London, Frankfurt and Madrid inch higher in early trade.
Saudi Arabia and Russia, the world's two top oil producers,
said an output cut needed to be extended for a further nine
months until March 2018 to rein in a global crude glut.
That drove a roughly 2.5 percent rise in oil prices
, and spurred gains for copper and iron ore and in
commodity-linked currencies including the Australian and
Canadian dollars and Russia's rouble.
At a time when central bank policymakers are wondering if
they have successfully got consumer prices moving upward again,
oil has been rising steadily for two weeks and may again start
to boost headline rates of inflation in the months ahead.
"This recovery in the oil and gas sector could well continue
this morning on reports that Saudi Arabia and Russia have agreed
to do 'whatever it takes' to keep a floor under oil," said
Michael Hewson, chief market analyst with CMC Markets in London.
"(That) has prompted oil prices to extend last week’s
The gains for European stocks were neither large nor across
the board, however, with Paris shares drifting lower.
The past fortnight has seen the emergence of some broad
concerns over the pace of economic growth in the United States
and China, and U.S. data on Friday was read as weak.
As European bond markets got going on Monday, U.S. Treasury
yields gained less from the oil bounce than their German
"The shadow of Friday's softer U.S. CPI and retail sales
data hangs over markets this morning," Societe Generale analyst
Kit Juckes said in a note to clients.
"The inability of the dollar to gain more ... reflects the
changing global landscape as recovery elsewhere drives rates and
yields a bit higher. With a thin U.S. data calendar, there's not
much to propel yields or the dollar back up."
Earlier, Asian stock markets shrugged off worries over the
'ransomware' cyber attack to reach a two-year high.
Hong Kong shares gained 0.9 percent and
their mainland equivalents 0.4 percent, after Beijing
soothed market fears of tighter regulation saying bank risks
were "completely controllable."
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
(editing by John Stonestreet)