Wall Street's late rally on Monday is expected to extend into today amid increased optimism that a resolution to the "fiscal cliff" negotiations will be reached by the end of the year.
U.S. stock index futures are modestly higher this morning, overseas markets are generally stronger, and crude oil and gold futures are ticking up.
The differences over how to head off the automatic tax increases and spending cuts set to take hold Jan. 1 appeared to have narrowed significantly Monday night as President Barack Obama reportedly made a counteroffer to Republicans that included a major change in position on tax hikes for the wealthy.
Mr. Obama proposed leaving lower tax rates in place for everyone except those earning $400,000 and above. That's up from the $250,000 threshold the president had been previously demanded, although far from Mr. Boehner's demands for $1-million. The White House also lowered the amount of tax revenue it is looking for to $1.2-trillion from $1.4-trillion, reports suggest.
Republican House of Representatives Speaker John Boehner, according to the Wall Street Journal, called it "a step in the right direction," but added that the concessions didn't go far enough.
But it was enough progress to spur speculation among traders that an agreement is starting to take shape and many are worried about being underweight equities ahead of year-end.
Of note overnight were further stock gains in Japan, where the Nikkei 225 advanced nearly 1 per cent, amid thoughts the election of the Liberal Democratic Party will pressure the central bank to increase bond purchases. The Japanese market has risen nearly 9 per cent in the past month.
Now, here's a look at what else you need to know this morning.
U.S. futures: S&P 500 +0.4 per cent; DJIA +0.3 per cent; Nasdaq +0.4 per cent
Hong Kong's Hang Seng index -0.08 per cent
Shanghai composite index +0.08 per cent
Japan's Nikkei +0.96 per cent
London’s FTSE 100 +0.34 per cent
Germany’s DAX +0.43 per cent
France's CAC 40 +0.02 per cent
WTI (Nymex Feb) +0.58 per cent at $88.18 (U.S.) a barrel
Gold (Comex Feb) +0.07 per cent at $1,699.40 (U.S.) an ounce
Copper (Comex Mar) -0.19 per cent at $3.66 (U.S.) a pound
Canadian dollar down 0.0006, or 0.06 per cent, at 1.0155 (U.S.)
ECONOMIC INDICATORS TO WATCH:
The U.S. Commerce Department said the current account narrowed to $107.5-billion in the third quarter, its lowest level since 2010 in the July through September period, mainly because the value of goods imported into the country fell.
(1000 a.m. ET) The U.S. National Association of Home Builders releases housing market index for December. Economists are looking for a reading of 47, up from 46 last month, which was the highest reading in 6 1/2 years.
STOCKS TO WATCH:
Samsung announced it will withdraw patent lawsuits against Apple in five European Union countries. Shares in Apple are up 1.5 per cent in the premarket.
Oracle Corp. reports earnings.
Boeing Co., Eli Lilly & Co., and Allstate Corp. all announced major share buybacks late Monday.
THIS MORNING'S TOP INVESTING READS ON THE WEB:
HBC's recent IPO didn't generate much traffic among skeptical investors. But Barron's suggests the stock is worth another look.
Since January, Edward Zabitsky of Toronto-based ACI Research has been arguing that Apple is headed to $270 a share. Here's his case against Apple.
Expectations are running low that any nation will drop the euro next year.
Gary Shilling on why India will displace China as the global growth engine.
Johnson & Johnson, through its missteps, alienated investors, including Warren Buffett. But now Wall Street is taking a brighter view, and the stock could be poised for a solid rise, according to Barron's.
South Korea was the rare developed nation to avoid recession during the global crisis, but outdated perceptions have kept investors away. That's changing, amid several positive trends.
Is the stock market today a ‘rigged game,’ too difficult for individual investors?
Bloomberg Businessweek's list of the worst CEOs of 2012.
The premarket report is constantly updated to reflect the latest news developments and market moves. For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities