Global markets shrugged off a major cyber attack that spread across the globe yesterday and were instead lifted by comments from the Bank of England that it may soon start raising interest rates.
The ransomware attacks which began in Russia and Ukraine on Tuesday spread to western Europe and across the Atlantic, and wrought havoc on government and corporate computer systems. The attackers demanded ransom from affected users.
Several multinational companies were targeted, including US pharmaceutical maker Merck, Russian state oil producer Rosneft and the French industrial company Saint-Gobain. The French bank BNP Paribas was also caught up in the attacks.
Investors in those companies mostly brushed off those concerns. Shares in BNP Paribas was up 2.5 per cent to €64.22 (Dh268) in early evening UAE time. Merck shares had gained 0.1 per cent to US$65.61. Rosneft shares climbed 1.7 per cent to 332.8 roubles.
The cyberattack recalled an outbreak last month which hit more than 150 countries and more than 200,000 victims with the WannaCry ransomware.
The fight against cyber criminals has sparked exponential growth in global protection spending, with the cybersecurity market estimated at $120 billion this year, more than 30 times its size a decade ago.
The attacks, however, were not enough to spook markets.
The British pound and US stocks rose after Mark Carney, the governor of the Bank of England, said rates may need to start rising soon.
The euro also rose after European Central Bank officials walked back comments from the ECB president Mario Draghi that the market was perceived to be dovish.
Mr Carney’s comments sparked a risk-on mood in financial markets less than a day after a host of events from an IMF cut to its US growth forecast, a new blow to the Republican agenda in Washington and a global cyber attack had ushered in a cautious tone. Investors took the latest central bank comments as evidence the global economy remains on a firm enough footing to withstand a slow withdrawal of stimulus that underpinned growth for years.
The euro also rose to $1.1380 as of 10.53am in New York, the highest level since June last year, according to Bloomberg. It briefly dipped before resuming gains on Mr Carney’s comments. The currency had climbed 1.4 per cent on Tuesday. The pound jumped 1.1 per cent to $1.2954.
The S&P 500 Index added 0.8 per cent in morning trade. The underlying gauge lost 0.8 per cent on Tuesday, the most since May 17, as technology and healthcare shares declined.
mkassem@thenational.ae
* with AFP, Bloomberg
