Stock Index Futures Gain as Investors Recover Risk Appetite

December S&P 500 E-Mini futures (ESZ25) are up +0.27%, and December Nasdaq 100 E-Mini futures (NQZ25) are up +0.39% this morning, signaling a rebound from yesterday’s sell-off on Wall Street as investor risk appetite gradually returns at the start of December, a period that has historically been strong for markets.

In yesterday’s trading session, Wall Street’s main stock indexes ended in the red. Moderna (MRNA) slid over -7% and was the top percentage loser on the S&P 500 after William Blair flagged an FDA report linking Covid-19 vaccines in younger people to deaths associated with myocarditis. Also, cryptocurrency-exposed stocks slumped after Bitcoin tumbled more than -5%, with Coinbase Global (COIN) sliding more than -4% and Strategy (MSTR) falling over -3%. In addition, Joby Aviation (JOBY) dropped more than -6% after Goldman Sachs initiated coverage of the stock with a Sell rating and a price target of $10. On the bullish side, Synopsys (SNPS) climbed over +4% and was the top percentage gainer on the S&P 500 and Nasdaq 100 after Nvidia invested $2 billion in the company as part of a broader engineering and design partnership.

Economic data released on Monday showed that the U.S. ISM manufacturing index unexpectedly fell to a 14-month low of 48.2 in November, weaker than expectations of 49.0. At the same time, the U.S. November S&P Global manufacturing PMI was revised higher to 52.2, stronger than expectations of 51.9.

“We have highlighted that stocks historically performed best when the economy is not in recession, and the Fed is cutting interest rates,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management. “The latest available data suggest that the Fed is more likely to proceed with a 25-basis-point cut.”

Meanwhile, U.S. rate futures have priced in an 87.2% probability of a 25 basis point rate cut and a 12.8% chance of no rate change at the Fed’s monetary policy committee meeting later this month.

On the trade front, the U.S. on Monday struck an agreement with the U.K. to allow tariff-free imports of pharmaceutical products in return for a substantial reduction in rebates drugmakers pay to Britain’s National Health Service (NHS). Under the agreement, the U.K. will pay 25% more in net prices for new medicines on the NHS and lower the rebate drugmakers pay on their medicine sales to the NHS to a maximum of 15%.

The Organization for Economic Cooperation and Development said on Tuesday that the U.S. and global economies are expected to slow next year as higher tariffs fully take effect, but could expand more strongly than anticipated if the AI investment boom “broadens.” The OECD expects the U.S. economy to expand 2% this year and 1.7% next year, up from its previous forecast of 1.8% growth this year and 1.5% in 2026. At the same time, the global economy is still projected to grow 2.9% next year, a slowdown from the expected 3.2% expansion this year. The OECD also warned, “A further rise in trade barriers, especially around critical inputs, could inflict significant damage on supply chains and global output.”

Today, market participants will monitor earnings reports from several notable companies, with CrowdStrike Holdings (CRWD), Marvell Technology (MRVL), and Pure Storage (PSTG) set to release their quarterly figures.

Also, Fed Vice Chair for Supervision Michelle Bowman is set to testify today before the House Financial Services Committee at a hearing titled “Oversight of Prudential Regulators.”

The U.S. economic data slate is empty on Tuesday.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.093%, down -0.10%.

The Euro Stoxx 50 Index is up +0.58% this morning, led higher by bank stocks. Bank stocks outperformed on Tuesday, with U.K. lenders rallying broadly in line with their EU peers after the Bank of England lowered the “appropriate benchmark” for Tier 1 capital requirements to around 13% of risk-weighted assets. That followed the BOE’s announcement that the seven largest British lenders have sufficient capital to withstand a severe global recession, sharp drops in financial markets, and a surge in interest rates. Industrial stocks also gained ground. Meanwhile, preliminary data from Eurostat released on Tuesday showed that the Eurozone’s annual inflation rate unexpectedly picked up in November, reinforcing expectations that additional European Central Bank rate cuts are unlikely anytime soon. Separate data showed that the Eurozone’s unemployment rate held steady at 6.4% in October. Investor focus now shifts to developments surrounding a potential Russia-Ukraine peace agreement. U.S. President Donald Trump’s special envoy, Steve Witkoff, and son-in-law Jared Kushner are set to meet Russian President Vladimir Putin later today. In corporate news, Bayer AG (BAYN.D.DX) surged over +9% after the Trump administration urged the U.S. Supreme Court on Monday to consider the company’s bid to block thousands of lawsuits alleging that its Roundup weed killer caused cancer.

Eurozone’s CPI (preliminary), Eurozone’s Core CPI (preliminary), and Eurozone’s Unemployment Rate were released today.

Eurozone’s November CPI rose +2.2% y/y, stronger than expectations of +2.1% y/y.

Eurozone’s November Core CPI rose +2.4% y/y, in line with expectations.

Eurozone’s October Unemployment Rate was 6.4%, weaker than expectations of 6.3%.

Asian stock markets today settled mixed. China’s Shanghai Composite Index (SHCOMP) closed down -0.42%, and Japan’s Nikkei 225 Stock Index (NIK) closed flat.

China’s Shanghai Composite Index closed lower today as investors remained cautious in anticipation of key policy meetings. AI-related stocks retreated on Tuesday due to profit-taking. Investors await the Politburo meeting and the Central Economic Work Conference later this month. China’s leadership is expected to outline key policy priorities for the world’s second-largest economy in 2026 and may signal whether additional stimulus is on the horizon. Hopes for additional measures to bolster economic growth from Beijing grew after data over the weekend showed that China’s manufacturing activity contracted for the eighth consecutive month in November. Still, ANZ analysts anticipate no change in the fiscal stance, which remains “more proactive” with a focus on execution and effectiveness, while monetary policy stays “moderately loose,” prioritizing precision over scale. The analysts added that policymakers are expected to keep the property stance centered on avoiding systemic risk. In other news, UOB Kay Hian analyst Tham Mun Hon said in a note that Chinese equities are expected to extend their rally in 2026, with the analyst favoring exposure to growth sectors such as AI and semiconductors, automation, and pharmaceuticals. In corporate news, NIO slid over -6% in Hong Kong after the EV maker reported weaker-than-expected November deliveries.

Japan’s Nikkei 225 Stock Index closed flat today, a day after prospects of a near-term rate hike by the Bank of Japan weighed heavily on stocks. Financial stocks outperformed on Tuesday, while utility and technology stocks lost ground. BOJ Governor Kazuo Ueda said on Monday that the central bank “will consider the pros and cons of raising the policy interest rate and make decisions as appropriate” by assessing the economy, inflation, and financial markets both domestically and overseas. Japanese Finance Minister Satsuki Katayama said on Tuesday that she sees no divergence between the government and the BOJ in their assessment of the economy. Meanwhile, Japanese sovereign bonds rebounded slightly on Tuesday after a 10-year auction attracted solid demand, offering temporary relief following a sharp selloff sparked by Ueda’s unexpectedly hawkish shift. Daiwa Securities strategist Kenji Abe said that even if a quarter-point hike occurs at the December BOJ meeting, the policy rate would remain accommodative and, together with improving corporate earnings, would continue to support the stock market. The firm anticipates that the Nikkei will climb to 60,000 by the end of next year. In corporate news, Fanuc climbed over +6% after announcing a plan to partner with Nvidia to improve industrial robots using AI technology. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -4.89% to 28.61.

The Japanese November Household Confidence came in at 37.5, stronger than expectations of 36.2.

Pre-Market U.S. Stock Movers

Chip stocks are moving higher in pre-market trading, with Marvell Technology (MRVL) rising over +2% and Broadcom (AVGO) gaining nearly +1%.

MongoDB (MDB) surged over +23% in pre-market trading after the database software company posted upbeat Q3 results and raised its full-year guidance.

Credo Technology (CRDO) jumped more than +18% in pre-market trading after the technology company reported better-than-expected FQ2 results and issued strong FQ3 revenue guidance.

DexCom (DXCM) gained about +2% in pre-market trading after Morgan Stanley upgraded the stock to Overweight from Equal Weight with a price target of $75.

Warner Bros. Discovery (WBD) rose over +1% in pre-market trading after the Wall Street Journal reported that the bidding war for the company has been intensifying.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Tuesday - December 2nd

CrowdStrike Holdings (CRWD), Bank of Nova Scotia (BNS), Marvell Technology (MRVL), Pure Storage Inc (PSTG), Okta (OKTA), Gitlab (GTLB), Box Inc (BOX), Signet Jewelers (SIG), American Eagle Outfitters (AEO), Asana (ASAN), Citi Trends (CTRN).