EMEA Morning Briefing: Stock Futures Lower at Start of Week

MARKET WRAPS

Watch For:

Manufacturing PMI for eurozone, Germany, France, U.K., Italy; U.K. money and credit; no major corporate trading updates expected

Opening Call:

European stock futures were lower at the start of the week. Asian stock benchmarks declined; the dollar was little changed; Treasury yields rose; while oil and gold futures advanced.

Equities:

Stock futures point to a lower open in European markets on Monday, as investors and traders brace for the beginning of the last month of the year.

It's a busy week of economic data that were delayed because of the U.S. government shutdown that ended earlier this month. Expectations are running high for a strong December for stock markets after a volatile November.

President Trump told reporters Sunday that he's picked his next Federal Reserve chairman and will make his announcement soon. He declined to confirm that his nomination to replace Jerome Powell will be Kevin Hassett, current director of the National Economic Council.

Forex:

The U.S. doesn't yet have the trilemma created by conflicting demands on tax, spending and borrowing, thanks to global demand for dollars funneling money into Treasurys. But there are worrying signs, and the fiscal situation suggests a growing chance of trouble ahead-despite faster economic growth than elsewhere.

What saves American finance is the dollar's status as the must-have global asset and trading currency. Both roles face challenges, though, and the more the U.S. exploits foreigners, the higher the risk they look elsewhere. There are four overlapping threats to the dollar: supply, China, reserve safety and the pushing away of allies.

None of these has, so far, dealt significant damage to the dollar's reserve status. But they all hurt.

Bonds:

The percentage of corporate defaults has been higher in the U.S. than in Europe since mid-2023, resulting in a weaker performance of U.S. high-yield credit versus its European equivalent, Societe Generale's Juan Valencia said.

Corporate defaults in Europe have stayed relatively low, ranging between 2% and 4%, although the levels are starting to rise, Valencia said. "The default rate [in Europe] remains contained but has been rising in recent months and it is something to keep an eye on in the coming months."

Energy:

Oil futures rose in Asia. Markets continue to focus on progress of Russia-Ukraine peace talks, Nanhua Futures said. Strict sanctions imposed by the U.S. on Russian energy companies have provided bottom-line support for oil prices.

U.S. and Ukrainian negotiators said Sunday's meeting on ending the war with Russia was productive, and top U.S. envoys will head to Moscow for further discussions.

Meanwhile, the Organization of the Petroleum Exporting Countries and their allies on Sunday confirmed a previously announced pause on production hikes for the first quarter of 2026, saying the curb was needed because of expected weaker seasonal market conditions and worries about surplus oil supplies.

Metals:

A period of consolidation is likely early this week for precious metals, Sucden Financial said.

"With previous resistance now broken, we believe the markets are well-positioned to move higher in the medium term if speculative risk-on sentiment returns," it added.

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The market narrative around tightening copper supply is becoming increasingly prevalent, said Sucden Financial.

However, the metal still lacks a decisive catalyst to force a breakout in prices. This leaves copper "highly sensitive to incremental bullish signals," such as improvements in downstream demand and modest supply disruptions at mid-tier mines or smelters. LME copper is likely to remain reactive and lean higher in response to relatively small upward shocks, Sucden said.

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Iron ore prices rose in Asia, but analysts remain bearish on the black metal in the near term. Iron ore's supply-demand dynamics haven't improved, Baocheng Futures said.

Market sentiment has been relatively positive, but analysts are concerned about short-term demand, it added.

TODAY'S TOP HEADLINES

America's Tariffs Jolted the Global Economy. Its AI Spending Is Helping Save It.

SINGAPORE-When President Trump announced his "Liberation Day" tariffs in April, economists predicted a global shock: The U.S. would buy less from the world, cutting exports and jobs.

Now some of those economists are revising their global growth predictions upward.

Is America Heading for a Debt Crisis? Look Abroad for Answers

Politics and debt don't mix well. Americans would be wise to look across the Atlantic to see how tough things can get.

The U.K. government demonstrated the problem with its annual budget, where it is stuck in a trilemma, unable to please lenders and voters while also doing the right thing for the economy. Something had to give, so on Wednesday the government ignored its promises to go for growth, and focused on the bond market and its political base.

After 'Productive' Meeting With Ukrainian Negotiators in Florida, U.S. Officials Head to Russia

HALLANDALE BEACH, Fla.-U.S. and Ukrainian negotiators said Sunday's meeting on ending the war with Russia-which included talks on possible elections, land swaps and security guarantees-was productive, and top U.S. envoys will head to Moscow on Monday for further discussions.

Secretary of State Marco Rubio, U.S. special envoy Steve Witkoff and President Trump's son-in-law Jared Kushner met with Ukrainian counterparts for more than four hours. Rubio said they made progress, adding that the negotiations are complex.

Scotland Wants to Issue Its Own Bonds. Last Time It Paid With Its Independence.

EDINBURGH-The last time Scotland went to the capital markets, it didn't work out too well.

It was 1695. Nearly 1,500 merchants and aristocrats bet around a quarter of the country's wealth establishing a colony on a mosquito-infested ribbon of land separating the Caribbean from the Pacific in an attempt to corner the global trade in spices, gold and anything else that could be bought, sold or stolen.

Trump's Focus on Drug War Means Big Business for Defense Startups

The U.S. military has turned its attention southward, and the defense industry is lining up to sell it the tools for a different kind of war.

Defense-tech companies and artificial-intelligence startups have found a vital new market in President Trump's rapidly escalating drug war. Weapons and AI platforms that were designed for a future conflict with China or struggled to prove themselves on the Ukrainian battlefield have found a niche in the administration's tech-enabled crackdown on drug trafficking.

'Significant Number' of Airbus Planes Require Critical Software Fix Before They Can Fly

Air travel around the world is facing potential disruptions this weekend after Airbus said a "significant number" of the European plane maker's jets require fixes before they are able to carry passengers again.

European and American regulators on Friday mandated the fixes after a solar-radiation event disrupted cockpit systems on an Airbus jet operated by JetBlue Airways in October. Under regulators' emergency order, jets could be temporarily grounded if airlines don't make certain software or hardware updates by Sunday.

Write to singaporeeditors@dowjones.com

Expected Major Events for Monday

00:01/UK: CBI Service Sector Survey

01:01/IRL: Nov Ireland Manufacturing PMI

05:30/NED: Oct Retail turnover

06:00/NED: Nov Netherlands Manufacturing PMI

07:00/NOR: 3Q Credit Indicator C3

07:00/TUR: 3Q GDP

07:00/TUR: Nov Turkey Manufacturing PMI

07:30/SWI: Oct Retail Sales

07:30/HUN: Oct Trade Balance

08:00/POL: Nov Poland Manufacturing PMI

08:15/SPN: Nov Spain Manufacturing PMI

08:30/CZE: Nov Czech Republic Manufacturing PMI

08:30/SWI: Nov procure.ch Purchasing Managers' Index

08:45/ITA: Nov Italy Manufacturing PMI

08:50/FRA: Nov France Manufacturing PMI

08:55/GER: Nov Germany Manufacturing PMI

09:00/POL: 3Q GDP

09:00/GRE: Nov Greece Manufacturing PMI

09:00/EU: Nov Eurozone Manufacturing PMI

09:30/UK: Oct Money and Credit - Lending to Individuals, Lending to Businesses, Broad Money and Credit

09:30/UK: Oct Monetary & Financial Statistics

09:30/UK: Oct Bank of England effective interest rates

09:30/UK: Nov S&P Global UK Manufacturing PMI

10:00/CYP: Oct Retail trade

10:00/CYP: 3Q GDP

15:59/UKR: Oct Industrial Production

16:59/AUT: Nov Unemployment figures

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This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

December 01, 2025 00:16 ET (05:16 GMT)