Stocks and commodities are advancing today on hopes that the United States will avert fiscal crisis.
Futures on the S&P 500 rose by more than half a percent, while European indexes are higher by more than a full percentage point. Commodities are also up across the board, and Asian markets rallied in the overnight session.
The main focus is on public finances in the United States, which faces the potential double-whammy of steeper taxes and less government spending unless leaders reach an agreement. Investors received a boost of confidence yesterday when Nancy Pelosi, the ranking Democrat in the House, said a deal was possible by mid-December.
Her statement comes after worries about the so-called "fiscal cliff" had driven the S&P 500 to its lowest price in 3-1/2 months. The index closed near its highs on Friday, suggesting that buyers are returning the market. Treasury yields are back near support levels, which could make investors want to sell bonds and buy equities.
Commodities also reflect a willingness to take risk. Oil and copper are higher by about 1 percent, while gold and silver rose by more than half a percent. Most agricultural foodstuffs are also rallying.
Foreign-exchange markets are slightly bullish as well, with the euro, Australian dollar and Canadian dollar all higher against the greenback. The Japanese yen is gaining after a big selloff last week.
In company-specific news, home-improvement retailer Lowe's is indicated to open higher by about 4 percent after third-quarter earnings and revenue beat expectations. Other S&P 500 companies issuing results today include Tyson Foods and Agilent Technologies.
This week is shortened because of Thanksgiving on Thursday. The calendar will focus on real estate and consumers, which have been strong of late. Existing home sales and the housing market index are both scheduled for 10 a.m. ET today. Housing starts follow tomorrow and weekly jobless claims will move forward by one session to Wednesday morning.
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