Futures are looking to start the shortened holiday week on a strong note, with tech stocks leading a broad market rally. Nasdaq and S&P 500 futures are moving higher and setting both indexes up to erase December’s losses, while gold, silver, and copper rally to record highs amid strong risk appetite and expectations for easier Fed policy, with investors now appearing optimistic about a potential year-end Santa Claus rally. Just some trivia for you, since 1950, the so-called Santa Claus rally has been reflected by the S&P 500 rising by an average of 1.3% over the last five trading days of the year and the first two trading days in January. Despite hope of some near-term gains, some strategists see increased volatility next year as investors weigh FOMO on the AI-driven rally against concerns the boom could evolve into a bubble. Adding to this, recent mixed data, including rising unemployment, cooling inflation, and delayed reports following the government shutdown, has added to uncertainty. While the backdrop still supports the potential for a traditional Santa Claus rally in the final days of December and early January, tech stocks have come under pressure this month due to skepticism around AI infrastructure returns, although other sectors have helped offset weakness and keep markets close to all-time highs.
Deal or no deal? Mark Carney announced over the weekend that Canada will begin formal talks with the U.S. in January to review the Canada-U.S.-Mexico free trade agreement, with Internal Trade Minister Dominic LeBlanc set to lead discussions. The U.S. has signalled that any deal will depend on resolving disputes over access to specific markets like dairy market, as well as digital service regulations and alcohol distribution rules. Carney has said that he remains committed to protecting our industries, while also highlighting opportunities for closer collaboration in key sectors like autos, steel, aluminum, and forest products. The negotiations come amid recent trade tensions although Carney appears hopeful that Canada will come out stronger after negotiations.
Speaking of deals. The EU’s delayed trade pact with South America has once again stalled, undermining Europe’s efforts to establish its global economic influence and reduce reliance on the U.S. and China. European Commission President Ursula von der Leyen is now pushing to secure last-minute support from holdouts like Italy, whose concerns over domestic farming have so far blocked the agreement. The deal, which would create a market of 780 million consumers and deepen strategic ties with South America, is seen as key to Europe’s progress towards economic independence, but farmer protests and political hesitation continue to derail progress. Although leaders hope to finalize the pact in January, failure to do so would be a major setback for the EU and raise doubts about Europe’s credibility as a global trading partner.
Emerging markets are entering 2026 with strong momentum, with strategists seeing the asset class as a top investment opportunity following its best year for capital inflows since 2009. Investors, portfolio managers, and major banks are growing bullish on developing economies thanks to improving debt and inflation trends, attractive yields, rising benchmark weightings, and expectations of further inflows driven by a weaker U.S. dollar and global AI investment. After years of underperformance, EM stocks are now outperforming U.S. equities, bonds have tightened yield gaps with Treasuries, and carry trades are generating impressive returns, fueling more optimism. While risks such as China’s slowdown and a potential dollar rebound are front of mind, investors seem to be shaking off those concerns, with flows into emerging-debt and equity funds continuing to rise.
Global regulators are increasing their scrutiny of the private credit market amid concerns that some lenders may be rate shopping for the most favourable debt grades, raising risks in the $1.7 trillion sector. The Financial Stability Board is examining whether private credit ratings lack the safeguards applied to other products, while some central banks and regulators plan to evaluate ratings firms as part of a broader stress test on private markets to assess how they might respond to a severe economic shock. Regulatory attention has increased following high profile losses in private assets and a U.S. SEC probe into a major rating provider, fueling worries about potential vulnerabilities within the space.
The new owners of the famous Home Alone house in Illinois are renovating the property to restore it to its former glory, which essentially means what it looked like in the movies. Built in 1921 and spanning roughly 9,000 square feet, the house remains a pop-culture landmark that draws crowds, especially during the holidays. Purchased earlier this year for $5.25 million, the five-bedroom home is undergoing an interior redesign to bring back the warm, colourful feel that defined the McCallister household (without all the booby traps though). If Chicago is too far away, but you want to experience some 90’s Christmas nostalgia, this may be more up your alley. Fans of Tim Allen’s The Santa Clause can book a stay at the Oakville, Ontario house where the 1994 holiday movie was filmed, although it won’t come cheap with a two-night stay over Christmas costing around $4,200 plus fees.
Diversion: How’s that?
