The market's current calm is partly due to Donald Trump's latest tariff threats. After targeting Canada, Mexico, and China, Trump has now set his sights on the BRICS nations. He's demanding they refrain from creating or using a currency to rival the dollar, threatening them with 100% tariffs otherwise. Investors are worried that a trade war and rising inflation could hinder further interest rate cuts. All eyes will be on Federal Reserve officials' comments on Monday and Fed Chair Jerome Powell's speech on Wednesday.

As traders hold their breath for Black Friday and Cyber Monday sales data, Wall Street takes a breather after a bustling November. These sales figures are anticipated to offer a glimpse into the holiday shopping season's vigor.  Despite the holiday-shortened trading week, U.S. indices set new records, capping off a stellar November. The Dow Jones rose 7.5%, the Nasdaq 6.2%, and the S&P 500 5.7%. The Russell 2000, tracking smaller U.S. stocks, led with a 10.8% gain, benefiting from Trump's re-election. Meanwhile, Europe struggles to keep up, with the DAX gaining 2% in November, while the French CAC40 fell 2.35%.

Overall, the S&P 500 up 26.5% since January 1. Historically, December is a favorable month for investors, boasting 70 gains over the past 96 years on the S&P 500, according to Yardeni Research.

France, however, is the eurozone's weak link following the National Assembly's dissolution. Michel Barnier's government teeters on the brink, unsettling financial markets. Despite this, S&P maintained France's "AA-" rating with a stable outlook.

In China, 10-year bond yields dipped below 2% for the first time since 2002, signaling expectations of continued rate cuts by the central bank. November's manufacturing PMI showed a positive trend, though attributed to pre-emptive shipping ahead of potential tariff hikes. Services PMIs disappointed, and the Communist Party's silence on its November meeting leaves investors guessing.

In a twist, Trump appointed Charles Kushner as U.S. ambassador to France and met with Canadian Prime Minister Justin Trudeau, likely to discuss tariffs. Meanwhile, Joe Biden pardoned his son Hunter, drawing media ire.

In the Middle East, Syria is in turmoil again after Aleppo's recapture by government opponents.

On the macro agenda, watch for Powell's speech and U.S. employment data, ECB chief Christine Lagarde's address, and the OPEC+ meeting.

In Asia-Pacific, markets opened the week with modest gains in Australia, India, and Hong Kong, while Japan and China showed stronger performances. South Korea slipped slightly. European indicators are positive, with the Stoxx Europe 600 up 0.5%, and Wall Street opened slightly higher.

Today's economic highlights:

The second reading of the manufacturing PMI indices for the major economies will be published throughout the session. In the US, it will be rounded off with the ISM manufacturing index. The full calendar is here.

  • Dollar: EUR 0.9156
  • Ounce of gold: USD 2,640
  • Brent crude: USD 72.57
  • 10-year US bond: 4.20
  • Bitcoin: USD 95,670

In corporate news:

  • In November, Germany and the UK's manufacturing sectors contracted due to weak demand and falling output, while South Korea and Taiwan experienced expansion thanks to improved operating conditions and increased new orders, and France's manufacturing sector also contracted.
  • Australia has implemented a new law prohibiting under-16s from using social media, while Meta Platforms tightens advertising rules and the government proposes hefty fines for tech giants like Apple, Google, and Meta to combat anti-competitive practices and enhance online safety.
  • The Monetary Authority of Singapore fined JPMorgan Chase $1.8 million for failing to prevent and detect misconduct by its relationship managers in 24 over-the-counter bond transactions.
  • Amazon Web Services has introduced new generative AI features for its Amazon Connect cloud contact center platform.
  • Millicom International Cellular has initiated a $150 million share buyback program to enhance shareholder value and reduce stock price volatility, alongside plans to delist from Nasdaq Stockholm.
  • McEwen Mining's exploration update at the Grey Fox deposit in Ontario reports positive gold assays, indicating new opportunities for resource expansion and increased production.
  • Nvidia is among a group of institutional investors participating in a $700 million private placement for tech company Nebius. As a result, Nebius has decided to halt its buyback program, initially launched in August to offer legacy shareholders an exit amid a trading suspension on Nasdaq. Nebius is formerly known as Yandex.

Analyst recommendations:

  • Cloudflare, Inc.: Morgan Stanley upgrades to overweight from equal weight with a price target raised from USD 92 to USD 130.
  • Sentinelone, Inc.: Morgan Stanley downgrades to equalwt from overwt with a target price of USD 29.
  • The Gap, Inc.: JP Morgan upgrades to overweight from neutral with a target price raised from USD 28 to USD 30.
  • Toast, Inc.: Goldman Sachs downgrades to neutral from buy with a price target raised from USD 34 to USD 45.
  • Zebra Technologies Corporation: Morgan Stanley upgrades to equalwt from underwt with a target price raised from USD 305 to USD 400.
  • Affirm Holdings, Inc.: JP Morgan maintains its overweight recommendation and raises the target price from USD 56 to USD 74.
  • Bill Holdings, Inc.: Goldman Sachs maintains a neutral recommendation with a price target raised from 77 to USD 96.
  • Block, Inc.: Bernstein maintains its outperform rating and raises the target price from USD 90 to USD 120.
  • Celanese Corporation: Jefferies remains at a hold recommendation with a price target reduced from USD 104 to USD 82.
  • Coinbase Global, Inc.: Goldman Sachs maintains a neutral recommendation with a price target raised from 183 to USD 397.
  • Healthequity, Inc.: Jefferies maintains its buy recommendation and raises the target price from USD 95 to USD 118.
  • Marvell Technology Group Ltd: Evercore ISI maintains its outperform recommendation and raises the target price from USD 98 to USD 122.
  • Mongodb, Inc.: Loop Capital Markets maintains its buy recommendation and raises the target price from USD 315 to USD 400.
  • Netflix, Inc.: Evercore ISI maintains its outperform recommendation and raises the target price from USD 775 to USD 950.
  • Robinhood Markets, Inc.: Goldman Sachs maintains a neutral recommendation with a price target raised from 25 to USD 40.
  • Salesforce.com, Inc.: Piper Sandler & Co maintains its overweight recommendation and raises the target price from USD 325 to USD 395.
  • Sofi Technologies, Inc.: JP Morgan maintains its neutral recommendation and raises the target price from 9 to USD 16.
  • Tesla, Inc.: Stifel maintains its buy recommendation and raises the target price from USD 287 to USD 411.
  • Zillow Group, Inc.: Canaccord Genuity maintains its hold recommendation with a price target raised from 64 to USD 86.
  • Anglo American Plc: AlphaValue/Baader Europe downgrades to add from buy with a target price reduced from GBP 32.07 to GBP 30.91.
  • Associated British Foods Plc: Deutsche Bank upgrades to hold from sell with a target price raised from GBX 2200 to GBX 2290.
  • Barratt Redrow P: RBC Capital upgrades to outperform from sector perform with a target price of GBX 575.
  • Burberry Group Plc: Deutsche Bank upgrades to buy from hold with a price target raised from GBX 860 to GBX 1180.
  • Crest Nicholson Holdings Plc: RBC Capital upgrades to sector perform from underperform with a target price raised from GBX 200 to GBX 210.
  • Hsbc Holdings Plc: AlphaValue/Baader Europe upgrades to add from buy with a price target reduced from GBX 935 to GBX 906.
  • Imi Plc: AlphaValue/Baader Europe downgrades to reduce from add with a price target reduced from GBX 1964 to GBX 1899.
  • John Wood Group: Barclays upgrades to equalweight from underweight with a target price reduced from 1.65 to GBP 1.75.