The Monday Market Minute

  • Global stocks book solid Monday gains as European investors react to a breakthrough in Brexit negotiations and a softer budget stance from Italy.
  • Wall Street futures surge following a record Thanksgiving shopping weekend that suggest robust consumer demand for the December holiday period.
  • Global oil prices rebound from Friday's vicious sell-off, although investors remain focused on U.S. production rates over potential OPEC cuts.
  • U.S. equity futures point to a 240-point opening bell gain for the Dow and a 30.5-point rise for the S&P 500.

Market Snapshot

Global stocks traded higher Monday, with Wall Street set to ride a record Black Friday spending weekend into solid opening bell gains while European benchmarks were buoyed by a breakthrough in Britain's EU exit talks and reports of a softening stance on spending from Italy's coalition government, as investors head into the final week of a tumultuous month for equity markets around the world.

Prime Minister Theresa May was able to win support for her EU exit plan from all 27 member states following a weekend summit in Brussels, but now faces the not insignificant task of selling it to lawmakers in Britain, where is seems unlikely to win the requisite 316 votes in Parliament early next month. Nonetheless, the fact that she was able to secure unanimity among EU leaders suggests at least a small nudge forward in the ongoing Brexit drama.

European stocks were further buttressed by reports that Italy is willing to revisit some of its 2019 spending commitments in order to trim its budget deficit targets and win approval from EU officials who've been concerned that adding billions to its already mountainous debt pile, just as the region's economy is flashing its weakest growth signals in at least four years, could disrupt broader financial stability. 

The region-wide Stoxx 600 was marked 0.9% higher by mid-day in Frankfurt, led by a 1.25% gain for the DAX performance index in Germany and a 1% jump for the CAC-40, while Britain's FTSE 100 added 1.11% as the pound held at 1.2843 against the U.S. dollar. 

Italy's FTSE MIB, meanwhile, surged 2.75% as bank stocks roared and government bond yields tumbled to multi-month lows after a government official was quoted as saying the coalition to reduce its budget deficit to as little as 2% of GDP to avoid censure from Brussels. 

Early indications from U.S. equity futures suggest a similarly strong start to the trading day on Wall Street, where investors look set to take a record Thanksgiving shopping weekend -- which saw consumers spend nearly $10 billion over the first two days of the four-day period -- as a signal of robust demand for the December holiday season.

Contracts tied to the Dow Jones Industrial Average suggest a 240-point surge at the opening bell while those tied to the S&P 500 are indicating a 27-point gain for the broader benchmark. Nasdaq Composite futures are guiding to a 96-point gain for the tech-heavy index following Friday's 0.48% decline.

Talk about classic bear market behavior. We crater all week and then we open up huge on nothing, but because we are so oversold it is hard to let things go...

— Jim Cramer (@jimcramer) November 26, 2018

Markets in Asia, however, were only modestly higher across the session as investors continue to fret over the fate of U.S. China trade talks, which are set to resume this week and culminate with a make-or-break meeting between Presidents Donald Trump and Xi Jinping later this month at the G20 summit in Argentina, although Europe's strong start added some positive sentiment to late-hours trading.

Japan's Nikkei 225 booked a 0.76% gain by the close of trading in Tokyo while the region-wide MSCI Asia ex-Japan benchmark added 0.92% heading into the final hours of the trading session.

Global oil prices rebounded sharply in early European trading, following Friday's vicious sell-off that saw Brent crude prices fall below $60 for the first time this year, although investors are still focused on the implications of record U.S. production rates over the impact of any potential OPEC cuts that may or may not be agreed at next month's key summit in Vienna.

Brent crude contracts for January delivery, the global benchmark, were seen $1.21 higher from their Friday close in New York and changing hands at $60.01 per barrel while WTI contracts for the same month, which are more tightly liked to U.S gas prices, were marked 73 cents higher at $51.15 per barrel.