U.S. index futures rose slightly in pre-market trading on Monday as investors focused on the presidential election and the Federal Reserve’s rate decision. Tuesday’s election is seen as a crucial catalyst; a divided Congress would maintain the status quo, while a unified victory could bring new spending and tax reform plans. Additionally, the market is watching S&P 500 earnings reports, where 70% of companies have exceeded expectations, and the upcoming Fed meeting, with a 96% chance of a rate cut according to CME Group’s FedWatch.
At 5:21 AM, Dow Jones futures (DOWI:DJI) were up 30 points, or 0.07%. S&P 500 futures gained 0.19%, and Nasdaq-100 futures advanced 0.15%. The 10-year Treasury yield stood at 4.297%.
In the commodities market, West Texas Intermediate crude for December rose 2.83% to $71.46 per barrel, while Brent for January rose 2.65% to $75.04 per barrel.
Oil prices were boosted after OPEC+ postponed its December production increase to January, keeping supply tight. The group will maintain its 2.2 million barrels per day cut, countering expectations of a production increase. Analysts note OPEC+ appears focused on supporting prices, while geopolitical tensions and events like the U.S. elections and the Chinese legislative meeting keep investors alert.
Brent and WTI fell about 4% and 3% last week due to U.S. record production, but both contracts rose on Friday amid reports that Iran could retaliate against Israel, as cited by Axios.
Copper (CCOM:COPPER), aluminum (CCOM:ALUMINUM), nickel, and iron ore gained with the dollar weakening ahead of the U.S. elections and expectations of new Chinese stimulus. A weaker dollar lowers commodity prices, while investors await economic support measures from the Chinese government.
In today’s U.S. economic calendar, the September factory orders report is due at 10 AM. The median forecast points to a 0.5% drop, a slowdown from the previous month’s -0.2%.
Asia-Pacific markets closed higher on Monday. China’s CSI 300 rose 1.41%, ending at 3,944.76. In Hong Kong, the Hang Seng was up 0.27% at the final trading hour, while Australia’s S&P/ASX 200 closed with a 0.56% gain. Taiwan rose 0.81%. Japanese markets were closed for a holiday.
South Korean stocks gained, with the Kospi up 1.83% and the Kosdaq rising 3.43%, following the opposition party’s support for the government’s decision to drop the capital gains tax for retail investors. The move aims to strengthen the local market and attract domestic investors.
BYD (USOTC:BYDDY) increased production by 200,000 units from August to October and hired 200,000 employees. In Q3, net profit grew 11.5%, and revenue rose 24%, reaching $28.24 billion, surpassing Tesla (NASDAQ:TSLA).
This week, investors are focused on China’s parliamentary meeting, with expected fiscal support announcements by Friday. On Thursday, China’s October trade data will be released following weak September results. In South Korea, October inflation data will be released on Tuesday, projected to fall to 1.4% year-over-year. Australia’s central bank will also decide on interest rates on Tuesday, likely holding at 4.35%.
European markets are mixed, with notable gains in the automotive sector, while technology declines.
Among major highlights, shares of Burberry (LSE:BRBY) rose amid rumors that Moncler (BIT:MONC) might make a buyout offer.
Volvo Car AB (TG:8JO1) reported a 3% global sales increase in October, with strong sales of electrified models in Europe, where sales rose 21%. In total, 48% of sales were electric or hybrid models.
Wizz Air (LSE:WIZZ) reported an increase in passengers and capacity in October, carrying 5.6 million people, 4.1% more than last year. Capacity increased by 3.7%, with a load factor of 92.9%.
European leaders congratulated Maia Sandu on winning Moldova’s presidential runoff, reinforcing the country’s pro-European direction. Sandu defeated the pro-Russia candidate with 55.4% of the vote, driven by diaspora support. The victory is celebrated as a democratic advance and a step toward European integration.
On Friday, the U.S. market rebounded after a sharp sell-off on Thursday, with the Nasdaq rising 0.8%, the Dow 0.7%, and the S&P 500 0.4%. For the week, the Dow fell 0.2%, while the S&P 500 and Nasdaq dropped 1.4% and 1.5%, respectively. Intel (NASDAQ:INTC) and Amazon (NASDAQ:AMZN) boosted the Nasdaq with gains of 7.8% and 6.2%, respectively. Conversely, Apple (NASDAQ:AAPL) fell despite strong results.
The jobs report showed a smaller-than-expected increase, fueling optimism regarding interest rates. Nonfarm employment rose by just 12,000 in October, below the 113,000 forecast, with the unemployment rate steady at 4.1%.
Millions of Americans will vote on Tuesday in one of the closest presidential races. Kamala Harris and Donald Trump are in a virtual tie, focusing on seven battleground states, including Pennsylvania, which has a strong history of deciding elections. Beyond the presidency, Congress’s renewal is also at stake, influencing the balance of power. Vote counting may take days, especially in states with significant early voting and no central counting authority.
Harris holds a slight edge in some polls, such as ABC News/Ipsos, which shows her leading 49%-46%, and the New York Times/Siena poll, where she leads in five of seven battleground states. In traditionally Republican Iowa, a Des Moines Register poll shows Harris ahead, indicating gains among Midwestern voters.
In quarterly reports, Constellation Energy Corp. (NASDAQ:CEG), Marriott International (NASDAQ:MAR), Berkshire Hathaway (NYSE:BRK.B), DigitalOcean (NYSE:DOCN), Freshpet (NASDAQ:FRPT), YumChina (NYSE:YUMC), SelectQuote (NYSE:SLQT), Fidelity National Information Services (NYSE:FIS), Franklin Templeton (NYSE:BEN) and Zoetis (NYSE:ZTS) will report earnings before the open.
After the close, reports are expected from Palantir (NYSE:PLTR), Hims & Hers Health (NYSE:HIMS), Cliffs Natural Resources (NYSE:CLF), Wynn Resorts (NASDAQ:WYNN), NXP Semiconductors (NASDAQ:NXPI), Lattice Semiconductor (NASDAQ:LSCC), Astera Labs (NASDAQ:ALAB), Navitas Semiconductor (NASDAQ:NVTS), Progressive (NYSE:PGR) and Teradata (NYSE:TDC), among others.