Futures Rise, Japanese Yields Surge, Gold And Silver Soar
As we previewed late last week, the Santa Rally is back all right, and US equity futures are trading near session highs with the Nasdaq 100 poised to wipe out December’s losses as revived appetite for technology stocks powered gains across equity markets. As of 8:15am ET, S&P futures are 0.4% higher after the benchmark climbed 0.9% on Friday, the most in close to a month; Nasdaq futures rise 0.6% set to build on Friday’s jump as NVDA jumped 2% on a Reuters report the company sees H200 shipments to China starting by mid-February; Oracle and Micron both climbed more than 2% in premarket trading while most members of the Magnificent Seven megacaps advanced.Tech and mining shares outperformed in Europe. In Asia, benchmarks most exposed to artificial-intelligence demand, including South Korea’s Kospi, also led gains. Global bond markets remained under pressure, led by a second day of losses in Japanese debt following an interest-rate hike by the Bank of Japan. The dollar fell. Gold ($4400) silver ($69) and copper all climbed to record highs.The US economic calendar includes the Chicago Fed national activity index (8:30am). No Fed members scheduled to speak for the session
In premarket trading, Nvidia and Tesla lead gains among the Mag 7 tech stocks as sentiment toward AI-exposed companies improves following Micron Technology’s results last week. Nvidia has told Chinese clients it aims to ship its second-most powerful AI chips to China by mid-February, Reuters reports, citing people familiar with the matter. (NVDA +1.7%, TSLA +1.2%, GOOGL +0.5%, AMZN +0.4%, META +0.4%, MSFT +0.3%, AAPL is little changed).
- Gold and silver miners advance after prices of both precious metals hit record highs. Newmont (NEM) climbs 2% and Coeur Mining (CDE) rises 4%.
- Clearwater Analytics Holdings Inc. (CWAN) is up 8% as a group of private equity firms led by Permira and Warburg Pincus has agreed to acquire the investment and accounting software maker in a deal valuing it at $8.4 billion including debt.
- Honeywell (HON) slips 1% after the industrial conglomerate adjusted its full-year and fourth quarter 2025 guidance to reflect the reclassification of its Advanced Materials business — now Solstice Advanced Materials Inc. — as it discontinued operations following its spinoff on October 30.
- Marvell Technology (MRVL) rises 2% after Citi opened a positive catalyst watch on the chipmaker ahead of next month’s CES conference.
- Rocket Lab (RKLB) gains 4% after saying late Friday that it won a contract to design and build 18 satellites, the company’s largest single contract to date.
- T1 Energy (TE) climbs 7% after it signed a three-year contract to supply Treaty Oak Clean Energy with a minimum of 900MW of solar modules built with domestic solar cells from T1’s planned G2_Austin solar cell fab.
A year-end rally in stocks is taking hold, with investors positive about further gains in 2026, although volumes are set to be thinner in this holiday-shortened trading week. Sentiment has been bullish for three weeks in a row, according to Deutsche Bank strategists. Meanwhile, in commodities, oil rose as Trump intensified a blockade on Venezuela. Gold and silver soared to all-time highs on the escalating geopolitical tensions and bets on Fed rate cuts.
“It has been very remarkable how precious metals’ prices have decorrelated from other assets in recent months,” said Roberto Scholtes, head of strategy at Singular Bank. “Earlier this year, gold prices were materially correlated to the dollar and to high-beta risk assets such as tech stocks and cryptos. But this has been waning gradually, and nowadays they’re running freely.”
The focus on price moves in commodities went beyond record-setting metals, with oil climbing amid heightened geopolitical tensions after the US stepped up a blockade on Venezuela.
Bullishness toward stocks has pushed positioning higher, while fund managers are maintaining record low levels of cash, according to the latest BofA Fund Manager Survey. They are betting on a further rally next year, despite concerns in some quarters over rich valuations, heavy artificial intelligence capex and potentially over-optimistic earnings expectations. Separately, Goldman strategists say the economic outlook is supportive for small-cap stocks, a factor that’s underpriced by the market. The Russell 2000 is likely to advance 10% in 2026, close to the 12% return expected in the S&P 500, they say.
Optimism for a year-end rally in equities are growing after dip buyers late last week supported a rebound in US stocks. While some doubts about the AI trade and elevated valuations persist, optimism over the economy and corporate earnings is helping lift sentiment.
“Markets are riding a risk-on liquidity wave into year-end as resilient US growth underpins earnings next year, while a lower Fed fund rate eases financial conditions,” said Desmond Tjiang, chief investment officer for equities and multi-asset investment at BEA Union Investment. “Fears of AI capex and returns also recede on improving compute economics.”
Unlike the US, enthusiasm for European equities is missing on Monday as the Stoxx 600 slips 0.2% with utilities as well as food and beverage shares among the biggest laggards. Meanwhile, miners outperform as traders monitor the geopolitical outlook in Venezuela. Here are some of the biggest movers on Monday:
- Saipem shares rise as much as 4.3%, the most since July, after the Italian energy services and drilling specialist wins an offshore EPCI Contract Worth $3.1 Billion by QatarEnergy LNG.
- Fresnillo shares climb as much as 3% to a record high, leading a rally in mining stocks as gold, silver and copper prices hit record highs.
- Gruvaktiebolaget Viscaria shares rise as much as 17%, the most in more than a year, after Handelsbanken initiated coverage of the Swedish mining company’s stock with a buy rating, calling its growth potential attractive.
- Rank Group shares decline as much as 9.1%, hitting the lowest level since mid-May, after the gambling firm said its Spanish businesses, Enracha and Yo, were targeted by payment fraud totaling about €7.1 million.
- ASP Isotopes shares plunge as much as 50% in Johannesburg after Bronstein, Gewirtz & Grossman said it is investigating potential claims on behalf of purchasers.
- Fenerbahce shares fall as much as 3.5% in Istanbul to the lowest level since May after state-run Anadolu Agency reported the sports club’s chairman was questioned as part of an investigation into illegal drug use.
- Pantheon Resources shares drop as much as 58%, the most since April 2018, after pausing testing of the Dubhe-1 well, citing cost profile of winter operations and focus on “disciplined” capital allocation.
In rates, Japanese yields remain center stage, with the 10-year segment hitting its highest level since 1999. The yield is 6bps higher today, amid speculation the Bank of Japan may need to raise interest rates more aggressively. This has spilled into other global benchmarks, lifting US, UK and German yields by 1-2bps. US yields cheaper by 1bp to 2bp across the curve with 2s10s, 5s30s spreads steeper by 1.2bp and 1bp on the day. US 10-year yields trade around 4.165%, cheaper by 1.5bp vs.
In Asia, stocks extended gains, as tech firms tracked their US peers higher in a holiday-shortened week. The MSCI Asia Pacific Index climbed as much as 1.1%, with TSMC and Samsung Electronics supporting the gauge higher. Tech-heavy benchmarks in Taiwan and South Korea led gains in the region with a more than 1.5% increase each. Japan and Hong Kong shares also advanced. Here Are the Most Notable Asian Movers
- Kokusai Electric and Tokyo Electron shares climbed after Morgan Stanley MUFG analysts raised ratings and price targets for the stocks on signs of a recovery in demand for front-end semiconductor equipment. Meanwhile, Nidec shares rose after news the Japanese electronic component company’s founder Shigenobu Nagamori is stepping down from his position as chairman of the board.
- Shriram Finance shares surge to a record after analysts saw Mitsubishi UFJ Financial Group’s $4.4 billion investment improving prospects of a credit rating upgrade.
- Mixue Group shares surge as much as 13% in Hong Kong, the most since March 7, after the Chinese fresh tea maker opened its first store in the US.
- Moore Threads shares rise as much as 4.2% after the company unveiled a new generation of chips aimed at reducing dependence on Nvidia Corp.’s hardware.
- WiseTech shares drop as much as 4.7%, the most since Nov. 18, after Executive Chair Richard White’s investment vehicle RealWise entered into a collar derivative transaction.
- Seatrium shares gain after the offshore engineering company reached an agreement with Maersk Offshore Wind’s affiliate Phoenix II A/S to deliver a wind turbine installation vessel by Feb. 28.
- Kokusai Electric and Tokyo Electron shares climbed Monday after Morgan Stanley MUFG analysts raised ratings and price targets for the stocks on signs of a recovery in demand for front-end semiconductor equipment.
- Daikin shares rose as much as 2.7%, the most since Nov. 20, after SMBC Nikko Securities raised the Japanese air conditioner maker to outperform from neutral on expectations for demand recovery and capital efficiency improvement.
- Nidec shares climb as much as 7.3%, the most since Nov. 11, after news the Japanese electronic component company’s founder Shigenobu Nagamori is stepping down from his position as chairman of the board.
This week’s Treasury auctions kick-off at 1pm New York with $69 billion 2-year notes, followed by $70 billion 5-year notes and $44 billion 7-year notes Tuesday and Wednesday. Before today’s auction, the WI 2-year currently trades around 3.482% which is ~0.7bp richer than November’s sale
In FX, the upside in Japanese yields and officials’ jawboning has supported the yen versus the dollar. Bloomberg’s Dollar Index is down 0.2%, pressured also by the outperformance in AUD, NZD and GBP.
In commodities, as noted above, gold and silver sit at record highs, up 1.6% and 2.8% respectively. WTI crude oil futures are up 1.9% as the US pursues a third tanker in Venezuela. Bitcoin continues to rise, up 1.8%.
The US economic calendar includes September Chicago Fed national activity index (8:30am). No Fed members scheduled to speak for the session
Market Snapshot
- S&P 500 mini +0.4%
- Nasdaq 100 mini +0.6%
- Russell 2000 mini +0.4%
- Stoxx Europe 600 -0.2%
- DAX little changed
- CAC 40 -0.4%
- 10-year Treasury yield +2 basis points at 4.16%
- VIX +0.1 points at 15.05
- Bloomberg Dollar Index -0.2% at 1207.51
- euro +0.2% at $1.1737
- WTI crude +1.2% at $57.17/barrel
Top Overnight News
- U.S. Coast Guard Chasing Another Tanker Involved in Shipping Venezuela Oil: WSJ
- Russian General Is Killed After Car Bomb Explodes in Moscow: BBG
- Paramount Amends Bid for Warner Discovery With New Ellison Guarantee: WSJ
- Trump on Friday said he would call a meeting of insurance companies in the coming weeks to push them to cut prices and stay in the system.
- Trump on Friday announced deals with nine pharmaceutical companies to cut prices on most drugs sold through Medicaid and lower cash-pay prices, while committing to most-favoured-nation pricing for future drugs, according to Reuters. The companies also pledged more than USD 150bln in US manufacturing and R&D investment, agreed to remit some foreign revenues to offset US costs, and received relief from US tariffs in return.
- Charlie Kirk’s Empire Is Lining Up Behind a JD Vance Presidential Bid: WSJ
- Vanke Averts Default as Bondholders Approve Longer Grace Period: BBG
- Japan prepares to restart world's biggest nuclear plant, 15 years after Fukushima: RTRS
- CBS News Pulls ‘60 Minutes’ Segment; Correspondent Calls Decision Political: WSJ
- One of Elon Musk’s Old Enemies Joins the Race to Run GM: WSJ
- Syrians emptied Assad’s prisons. They’re filling up again, and abuse is rife: RTRS
- Toxic Fumes on Planes Blamed for Deaths of Pilots and Crew: WSJ
- The Warner Deal: Cinema owners fear that Netflix or Paramount acquiring Warner could reduce number of theatrical releases or speed time to streaming platforms: WSJ
- Trump names Louisiana governor as Greenland special envoy, prompting Danish alarm: RTRS
Central Banks
- ECB's Kazmir said that the ECB remains flexible and will be ready to step in if needed. He is concerned about the long term growth prospect of the Eurozone.
- Fed’s Hammack (2026 voter) said rates should be held steady into the spring after recent cuts, warning she was inflation-wary, noting November’s 2.7% CPI likely understated 12-month price growth due to data distortions, and suggesting the neutral interest rate was higher than commonly believed, the WSJ reported.
- Former BoJ member Sakurai said the first hike to 1.0% could come around June or July and that the BoJ likely sees the neutral rate sitting somewhere around 1.75%.
- Chinese Loan Prime Rate 5Y (Dec) 3.50% vs. Exp. 3.50% (Prev. 3.50%).
- Chinese Loan Prime Rate 1Y (Dec) 3.00% vs. Exp. 3.00% (Prev. 3.00%).
Trade/Tariffs
- China's Commerce Ministry is to impose levies of up to 42.2% on EU dairy products, effective 23rd December, following its anti-subsidy probe.
- New Zealand concludes free trade agreement with India; deal set to be signed in H1 2026. India and New Zealand are confident of doubling bilateral trade over the next five years.
A more detailed look at global markets courtesy of Newsquawk
APAC stocks kicked off the week with gains across the board as the region coat-tailed on the strength seen stateside. Tech outperformance continued across the region. ASX 200 edged higher as miners tracked gains in gold prices, with the yellow metal buoyed by a weekend packed with geopolitics Nikkei 225 was the clear outperformer as it topped 50.5k as the index cheered the post-BoJ JPY weakness on Friday alongside the global tech rally, whilst simultaneously overlooking the continuing rise in JGB yields. KOSPI was underpinned by its tech sector and following a month-to-date rise in exports. Hang Seng and Shanghai Comp conformed to the risk tone but with upside shallower than the above peers, with the PBoC LPR left unchanged as expected, whilst reports on Friday suggested US lawmakers urged the Pentagon to add DeepSeek and Xiaomi to the list of firms allegedly aiding the Chinese military.
Top Asian News
- Japanese Chief Cabinet Secretary Kihara said will not comment on the forex market; recently seeing one-sided, rapid moves; important for currencies to move in a stable manner reflecting fundamentals; will take appropriate action against excessive moves. Closely watching the impact of higher interest rates while cooperating with the BoJ.
- Japanese Top Currency Diplomat Mimura said he is recently seeing one-sided, rapid moves; will take appropriate action against excessive moves; concerned about forex moves.
- China Vanke (2202 HK) bondholders approve the decision on a vote for 30-day extension of CNY 2bln bond, however rejecting one-year extension for 15th Dec CNY 2bln bond, via Reuters sources.
- Goldman Sachs expect Chinese stocks to continue advancing in 2026, citing easing geopolitical tensions and as investors household savings begin flowing to equities as interest rates fall. Analyst Kinger Lau writes that "we expect the bull run to continue, but at a slower pace". Though the firm highlights some main risks to the upside, including; global recession, AI exuberance, US-China tensions and disinflation. Finally, analysts suggest that the macro / equity-market policies remain in effect which should shift the expected fair value of Chinese stocks upward.
European equities (STOXX 600 -0.2%) are trading lower/flat this morning, with price action fairly rangebound in light newsflow. European sectors are trading with a mostly negative bias. Basic Resources (+1.1%) leads on firmer metal prices, followed by Tech (+0.4%) on positive spillover from the strong Nasdaq close, and Energy (+0.3%) on higher crude amid ongoing geopolitical tensions between Russia-Ukraine and US-Venezuela. On the downside, Utilities (-0.9%), Optimised Personal Care (-0.9%) and Food Beverage and Tobacco (-0.9%) lag.
Top European News
- German Ifo survey finds that 26% of firms expect business to deteriorate in 2026, 59% expect no change, 15% forecast an improvement.
Geopolitics: Venezuela
- US Coast Guard officials over the weekend tracked two oil tankers in international waters close to Venezuela, marking three tankers within the past week. An official suggested that the tanker is subject to sanctions, according to several media reports.
- The Venezuelan government rejected the seizure of a new vessel transporting oil, it said in a statement.
Geopolitics: Ukraine
- US Special Envoy Witkoff said the Ukrainian delegation held productive meetings over three days in Florida with US and European partners, including a separate US–Ukraine meeting, with discussions focused on timelines and sequencing of next steps.
- Ukrainian President Zelensky said broader consultations with European partners should follow recent talks in the US.
- Ukrainian President Zelensky said allies had started to slow supplies of air defence missiles and said Kyiv should stand by the US as mediator on talks with Russia, commenting on French President Macron’s proposal.
- Ukrainian President Zelensky said the situation in the Odesa region was harsh after Russian strikes and said Russia was trying to