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U.S. and Canadian stocks are poised to open higher Monday as investors looked ahead to interest rate decisions this week and focused on the launch of bitcoin futures the spurred on investors' obsession with the cryptocurrency. However, U.S. futures pared their gains after police confirmed that an explosion rocked New York's Port Authority, one of the busiest commuter hubs in Mahnattan. The blast injured several and police confirmed that there was one person in custody. Some subway lines were being evacuated as a result.

Stealing the spotlight was the debut of bitcoin futures contracts, allowing investors to bet on the price of the cryptocurrency in one, two or three months.

The one-month contract, the most-traded on the Chicago-based CBOE Global Markets exchange, opened at $15,850 on Sunday night -- a gain of 21 percent.

It was last quoted at $17,500, having earlier traded as high as $18,850, while bitcoin itself hovered at $16,415.36.

Bitcoin has rocketed up a gravity-defying 1,600 percent since the start of the year, attracting institutional interest -- and concerns that it is a bubble in the making.

"The one-month contract is trading at around an 11 percent premium to the underlying bitcoin, and for me that's a clear indication that there's no connection between the two markets," said Lukas Daalder, chief investment officer at Robeco.

Several online brokerages have not yet allowed trading of the new futures.

"I can understand you don't see that many people who are willing to offer this contract, because you can't hedge your underlying risk if you can't short it," Daalder added.

"This only adds to the bitcoin phenomenon. It's interesting to watch, but not a market that I would like to touch."

While frantic trading kept bitcoin volatility dizzying, a gauge of S&P 500 volatility hovered below 10, nearing the record low hit in November, though it was edging up slightly after four days of declines.

In Canada, the launch of bitcoin futures accelerated the race among ETF providers in both Canada and the United States to be first to market with products that track the digital currency.

"The launch of the futures trading is just one more domino that seems to be falling into place in the approval of a bitcoin ETF," said Eric Balchunas, U.S. ETF analyst with Bloomberg Intelligence.

Later this week, the U.S. Federal Reserve will make its latest interest rate announcement, and while the Street is expecting an increase, investors will be listening carefully to what the Fed might do in 2018, especially after another strong jobs report last Friday.

World stocks rose, flirting with their most recent record highs, boosted by more benign Asian trading after Friday's strong U.S. employment data and Chinese trade figures cemented optimism on the global economy.

Global stocks rose 0.2 percent to 505.31, nearing last week's record of 507.09.

"Momentum behind stock markets has been pretty solid, supported in part by good numbers on the economic front and not bad earnings. I don't see anything happening right now that could break the momentum," said Daalder.

European stocks drew strength from a positive Asian session to trade higher in early deals. The rally dissipated after the open but Germany's cyclicals-heavy DAX and the index of leading European companies held onto gains.

Strong banks and mining stocks supported benchmarks, and Britain's FTSE climbed 0.4 per cent, helped by a weaker pound. Germany's DAX slipped 0.03 per cent and France's CAC was off 0.11 per cent.

In Asia, the Nikkei was up 0.56 per cent, the Shanghai index up 0.98 per cent and the Hang Seng gained 1.14 per cent.

Commodities

Oil prices edged lower on Monday as rising U.S. drilling activity pointed to a further increase in American production, countering OPEC-led output cuts.

Brent crude futures were 10 cents lower at $63.30 a barrel. U.S. West Texas Intermediate (WTI) crude futures were at $57.10 a barrel, down 26 cents from their last settlement.

Brent and WTI settled more than 1 percent higher on Friday, and oil prices have gained well over a third from 2017 lows.

"It's time for a breather," said Warren Patterson, commodities strategist with ING.

The gains are largely due to production cuts by the Organization of the Petroleum Exporting Countries and a group of non-OPEC producers, including Russia, which have been in place since the start of the year.

Analysts at PVM Oil Associates also said the "deteriorating geopolitical backdrop acted as a pillar of price support" over the past week, with turmoil in Yemen and potential worker strikes in Nigeria underpinning the market.

But all this could be undermined by rising output from the United States, which is not participating in the deal to withhold production.

Gold edged higher on Monday as the dollar retreated on the back of lackluster U.S. wages data, but moves were muted ahead of an expected interest rate hike from the U.S. Federal Reserve this week.

Spot gold was up 0.25 percent at $1,250.93 an ounce, while U.S. gold futures for February delivery were up $4.40 an ounce at $1,252.80. Spot prices fell 2.5 percent last week, their biggest weekly drop since May.

The Fed is widely tipped to lift rates at its two-day policy meeting ending Wednesday, but its accompanying statement will be closely watched for any surprises.

The bank is expected to increase rates another two or three times in 2018, but still-sluggish inflation and wage growth has raised question marks over that view.

"The FOMC's policy statement, Fed Chair Yellen's final press conference in charge, and the update to the summary of economic projections will be closely parsed for signs the Fed's longer term intentions," Mitsubishi analyst Jonathan Butler said.

"Though we expect few major changes to Fed policy until new Fed Chair Powell takes office, dovish language or any caution on the future pace of interest rate hikes... would give some support to gold by weakening the dollar and lowering Treasury yields."

Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.

Currencies and bonds

The dollar edged lower against a basket of currencies on Monday, snapping a five-day rising streak as investors took profits before a U.S. central bank meeting this week.

The Fed is widely expected to raise interest rates at its two-day policy meeting that will end on Wednesday, and is seen possibly tightening two or three times in 2018. But still-sluggish inflation and wage growth has clouded next year's policy outlook.

"I think this (the dollar's retreat on Monday) is being driven by the softer earnings data we saw in the payrolls report on Friday which reinforces the Fed's current policy dilemma, where yes we have solid growth but so far a lack of inflation pressure," said MUFG currency strategist Lee Hardman.

U.S. employment data on Friday showed a bigger rise in jobs than expected in November, but pay growth remained moderate. The annual increase in wages rose to 2.5 percent, from 2.3 percent in October but remained sluggish.

The dollar dipped 0.2 percent to 93.763 against a basket of major currencies, pulling away from a two-week high hit on Friday.

The Canadian dollar was near the 78-cent mark, but was flat as oil prices edged lower.

U.S. bond prices edged higher ahead of the Job Openings and Labor Turnover Survey (JOLTS) and the Fed's meeting later this week.

The 10-year Treasury yield was at 2.374 per cent, and 30-year Treasuries were at 2.764 per cent.

Canada 10-year bonds were yielding 1.85 per cent, slightly higher.

Stocks set to see action

Canadian Solar Inc. said on Monday it received a letter to be taken private by its chief executive officer, Shawn Qu. The solar company said Qu has offered to buy all of the outstanding shares he and his wife Hanbing Zhang do not already own for $18.47 per share. The offer represents a 7.1 per cent premium to Canadian Solar's Friday close.

The chief executive officer of Lundin Mining Corp. says the base-metals miner has "some work to do to get confidence back" after the recent sharp selloff in its stock. But Paul Conibear is also shrugging off any suggestions that the company was slow to disclose a damaging rock slide at its flagship mine.

Canada's Fairfax Africa Investments Proprietary Ltd. will not proceed with a plan to buy 23 per cent of cement producer PPC for 2 billion rand ($188.36-million), the South African company said on Monday. Last month PPC's board said it had advised Fairfax that it would not be recommending the Canadian company's partial offer to shareholders.

Bluebird Bio shares rose 11.13 percent after its experimental gene-modifying immunotherapy drug co-developed with Celgene received positive responses in early stage study. Celgene's shares were up 2.6 percent.

The launch of bitcoin futures raised investor interest in cryptocurrency-related companies. Shares of Marathon Patent, Riot Blockchain, Overstock.com and Xunei were up between 3.8 percent and 8 percent in premarket trading. Shares of Cboe Global Markets rose 3.7 percent.

HSBC drew a line under its punishment for lapses in anti-money laundering controls on Monday, saying the U.S. Department of Justice (DoJ) would end its deferred prosecution agreement, lifting the threat of further penalties. Europe's biggest bank paid a $1.9 billion fine and entered into the five-year deal in 2012 for failing to prevent Mexican drug cartels from laundering hundreds of millions of dollars. Its stock rose 1.17 per cent in premarket trading.

Auto parts retailer LKQ Corp. said it would buy German peer Stahlgruber for about 1.5 billion euros ($1.77 billion), including debt, to expand its already large European presence. Stahlgruber will help Chicago-based LKQ compete better with rivals including U.S.-based Genuine Parts Co, which in September announced its foray into Europe with a $2 billion deal to buy Alliance Automotive Group.

Xylem is buying Calgary-based infrastructure company Pure Technologies for $397-million in cash. The deal is expected to close in the first quarter of 2018.

More reading: Monday's small-cap stocks to watch
More reading: Bitcoin futures ease after initial 22 per cent surge

Economic News

(10 a.m. ET) U.S. Job Openings & Labor Turnover Survey for October is released.

Also: NAFTA inter-sessional meetings in Washington, D.C. continue through Dec. 15.

With files from Reuters and Bloomberg