MARKET WRAPS

Stocks:

European shares kicked off the week on the rise ahead of key U.S data releases and a busy week of central bank decisions.

"This week's intense line-up of data, events and decisions promises a volatile finish to the year and could set the tone for the start of the new year," Commerzbank Research said.

Delayed U.S. economic data this week is expected to show further weakness in the labor market. In particular, employment figures are due Tuesday, followed by CPI data on Thursday, with labor-market data likely leaving the door open for Federal Reserve rate cuts next year.

"In our view, the FOMC has room to deliver the 50 basis points of easing priced in by Fed funds futures over the next 12 months," Brown Brothers Harriman said.

Capital Economics said the Fed's interest-rate cutting cycle looks to prove relatively shallow and to be nearing its end . The current easing cycle hasn't been driven by a global recession, and most major economies, in particular in the U.S., have held up well over the past couple of years.

Investors will also pay close attention to the European Central Bank's last monetary policy meeting of the year on Thursday, where it is expected to keep rates on hold, leaving the deposit rate at 2%.

Focus will center on the ECB's GDP and inflation forecasts.

"We expect near-term growth projections to be substantially revised up and medium-term inflation to be modestly revised down ," RBC Capital Markets said. "That should lead to the ECB finally stating that growth risks are balanced."

In other central bank decisions this week, the Bank of England is widely expected to cut interest rates by 25 basis points to 3.75% on Thursday as it attempts to boost a flagging economy now that the much-awaited November budget is now out of the way. This will mark the fourth rate reduction in 2025.

Shares on the Move

London's miners rose in opening trade as gold and silver climbed to near-record highs. Hochschild Mining rose 6%, Endeavour's London-listed shares ticked up 3.5% while Fresnillo traded up 2.8%.

European chip-related stocks were mostly lower as falls in Asian tech stocks and the U.S. weighed on investor confidence. ASM declined 1.3%, while BE Semiconductor Industries fell 0.8%.

U.S. Markets:

Stock futures were up after rekindled fears around the AI boom knocked gauges on Friday.

Investors awaited delayed data this week and are expecting results from Nike, FedEx and Micron.

Forex:

The euro is steady. The euro's direction versus the dollar this week largely hinges on the U.S. nonfarm payrolls report and the ECB's policy decision , ING said.

The dollar stayed weak as expectations for further U.S. interest-rate cuts weighed.

Sterling has the potential to rise significantly on any positive surprises stemming from this week's U.K. data and the Bank of England's policy decision Thursday, ING said.

Positive surprises could include better-than-forecast U.K. jobs data , higher-than-anticipated inflation data Wednesday or the BOE sounding more cautious about cutting rates than expected.

Bonds:

Eurozone government bond yields fell in early trade, tracking Treasury yields. The ECB meeting this week will be the highlight for eurozone government bond yields, curves and spreads.

Treasury yields declined.

The Treasury curve was expected to steepen, driven by the short end, Citi said.

"We hold a bull steepening bias into 2026 due to growing risks for the unemployment rate to move higher either due to increased layoffs or a continued bounce back in the labor force participation rate."

The Fed's relatively shallow easing cycle explained high Treasury yields, Capital Economics said.

"The bond market is shifting towards pricing out further rate cuts and, in some cases, starting to consider hikes as the most likely next move, thereby putting upward pressure on yields across the curve."

The 10-year Bund yield fell, but it is expected to finish 2026 at 2.90%, not much above current levels , according to UniCredit.

Energy:

Oil prices edged higher in early trading, though gains were capped by diplomatic efforts to end the war in Ukraine and concerns of an oversupplied market.

Metals:

Gold prices climbed on a softer dollar and as investors awaited the release of key U.S. data.

Gold Chart

Comex gold futures were seeking to test resistance at $4,400/oz, based on the daily chart, RHB Retail Research said. The latest positive price movements reaffirm that gold bulls are still in the "driver's seat."

Copper

Copper rose. The base metal's ascent is unlikely to be derailed on strong fundamentals, ANZ said. "We are bullish on copper and expect the market to move further into deficit in 2026."

Iron

Iron ore prices were lower in early trading due to weak fundamentals. Demand for the metal remains at low levels, weighing on prices , Baocheng Futures said.

EMEA HEADLINES

BOE Expected to Cut as ECB Settles Into Its Good Place

Five of Europe's central banks will announce policy decisions Thursday, but investors expect only one of them to mirror the Federal Reserve by lowering borrowing costs: the Bank of England.

The European Central Bank hasn't changed its key rate since June, and believes itself to be in a "good place," with the eurozone economy having avoided a tariff-induced recession and inflation close to its target.

Sanofi Multiple Sclerosis Drug Hit by Double Setback

Sanofi said a U.S. regulatory decision on its tolebrutinib experimental treatment for a type of multiple sclerosis would be delayed again, and that a late-stage trial for a different form of the disease didn't hit its main goal.

The French pharmaceutical company said Monday that talks with the U.S. Food and Drug Administration had indicated a regulatory review for tolebrutinib in nonrelapsing secondary progressive multiple sclerosis would extend beyond a target action date of Dec. 28. The company expects further guidance from the FDA by the end of the first quarter of 2026, it said.

Danske Bank Completes U.S. Justice Department Probation Period

Danske Bank completed a period of corporate probation with the U.S. Justice Department, marking the end of a yearslong process that was started in the aftermath of a series of money-laundering investigations.

The Danish lender agreed to pay about $2 billion in late 2022 to settle long-running probes into anti-money-laundering failures that led to hundreds of billions of dollars of suspicious transactions flowing largely unchecked through a former branch in Estonia.

Why Germany Wants a Divorce With China

FRANKFURT-For two decades, Germany and China were an economic couple made in heaven, both benefiting handsomely from booming global trade: Germany supplied the machines China needed to make consumer goods for the rest of the world.

Now China no longer needs Germany-and Germany wants a divorce.

GLOBAL NEWS

BOJ Report Signaling Wage Growth Adds More Rate-Hike Fuel

TOKYO-Japanese companies seem keen to raise wages again next year, despite many bracing for a tariff hit to profits, a central bank report shows days ahead of its next policy meeting.

The findings, which come alongside a separate Bank of Japan survey on Monday showing improved business sentiment, will likely reinforce expectations that the central bank will raise interest rates to 0.75% from 0.5% this week.

What Delayed Jobs and Inflation Data Will Mean For Markets

Investors looking to wind down early ahead of the holidays are out of luck this year. This week, the market will get the gift of delayed government data-though they may be more like stocking stuffers than showstoppers.

The Federal Open Market Committee's December meeting is normally the last hurrah on a year's macroeconomic calendar, but this fall's government shutdown means that there will be two fresh reports to digest this week: The Bureau of Labor Statistics' jobs report for November, along with partial October data, is due out on Tuesday, and its November consumer price index reading is expected Thursday.

China's Economy Is Deteriorating on Several Fronts

China's economic momentum slowed broadly in November, with a marked weakening in consumer spending, adding pressure on Beijing to stabilize household and business demand in the world's second-largest economy.

Police to Release Person of Interest in Brown University Shooting

PROVIDENCE, R.I.-The manhunt continues for a suspect in Saturday's shooting at Brown University.

The person of interest in police custody will be released, said Providence Mayor Brett Smiley Sunday night.

One Sydney Attack Suspect Had Licensed Firearms, the Other Had Been Investigated

The father and son accused in Australia's deadliest mass shooting in nearly 30 years had six licensed firearms at the scene, police said Monday, as emerging details about the attack spurred calls to strengthen the country's gun laws.

The assault by two gunmen on a Hanukkah celebration Sunday at Sydney's Bondi Beach killed 15 people and stunned a country with strict firearms regulations and little gun violence. Authorities described it as a terrorist attack on the Jewish community.

Chile Elects Most Right-Wing President of Post-Pinochet Era

Chileans on Sunday elected their most right-wing president in a generation, with hard-line conservative José Antonio Kast winning easily after vowing to clamp down on crime and illegal immigration.

Kast's victory over Jeannette Jara, a Communist, adds to a wave of electoral wins by right-wing politicians across Latin America, giving President Trump new allies who are on board with his anti-migrant policies.

U.S. and Ukraine Try to Break Impasse Over Peace Deal With Russia

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12-15-25 0517ET