U.S. stock futures inched higher on Monday as investors prepared for this week’s Federal Reserve policy meeting. Markets are also weighing the implications of Netflix’s proposed takeover of Warner Bros Discovery’s TV and film assets. Meanwhile, Japan’s economy contracted more sharply than expected in the third quarter, and China reported a strong rebound in exports despite a steep drop in shipments to the United States.
1. U.S. Futures Hold Gains Ahead of Fed Decision
U.S. stock futures rose slightly on Monday, extending last week’s strength as traders look toward the Fed’s final policy meeting of the year.
At 02:40 ET (07:40 GMT), S&P 500 futures were up 0.2%, Nasdaq 100 futures climbed 0.3%, and Dow futures gained 0.1%.
All major U.S. indexes posted weekly gains, marking their second straight positive week. The S&P 500 and NASDAQ Composite also closed Friday with four-day winning streaks, while the Dow saw gains in three of its past four sessions.
Markets expect the Fed to cut rates on Wednesday, especially after September’s delayed core personal consumption expenditures index came in softer than forecast. CME’s FedWatch tool now shows an 88% probability of a 25-basis-point cut.
Economic data releases are limited on Monday, with major earnings from Broadcom, Adobe, Oracle, Costco, and Lululemon scheduled later in the week.
2. Netflix Faces Major Regulatory Battle Over Warner Bros Deal
Netflix (NASDAQ:NFLX) plans to acquire Warner Bros Discovery’s (NASDAQ:WBD) TV, film, and streaming divisions for $72 billion. However, the deal is expected to face intense antitrust scrutiny in the U.S. and Europe.
According to Anthony Saglimbene of Ameriprise Financial, the scale and complexity of the transaction mean both companies may need to divest assets to win approval.
Hollywood unions and theater owners have already voiced concerns, warning the deal could eliminate jobs, consolidate power, and reduce theatrical releases.
President Donald Trump added pressure by stating that he expects to play a role in deciding whether the merger proceeds. He highlighted concerns about concentration of market power within the entertainment industry.
3. Japan’s Economy Shrinks Faster Than Estimated in Q3
Japan’s economy contracted more sharply than initially reported in the third quarter, complicating the outlook ahead of the Bank of Japan’s policy meeting next week.
GDP fell 2.3% on an annualized basis, compared to the earlier estimate of 1.8%. This marks the steepest decline since the third quarter of 2023. Quarter-on-quarter, GDP dropped 0.6%, worse than the 0.5% expected.
The weaker performance supports Prime Minister Sanae Takaichi’s recently announced stimulus package, which includes the largest fresh spending program since the pandemic. The government expects the package to boost GDP by roughly 1.4 percentage points a year on average over the next three years.
Despite the contraction, the BOJ is still expected to raise interest rates at its December 18–19 meeting, as Japan’s inflation gauge has remained above the 2% target for more than three and a half years.
4. China’s Trade Surplus Surges in November
China posted a much larger-than-expected trade surplus in November as exports rebounded strongly. Customs data showed exports rising 5.9% year-on-year, reversing October’s decline, while imports rose 1.9%.
The trade surplus widened to $111.68 billion, beating expectations of $100.20 billion and jumping from October’s $90.07 billion.
The export rebound was led by strong demand outside the U.S. as Chinese manufacturers expand ties with alternative markets in response to high American tariffs. Exports to the U.S. plunged 29% year-on-year, while shipments to the European Union rose 14.8%, exports to Australia surged 35.8%, and Southeast Asian economies imported 8.2% more goods.
5. Oil Prices Hover Near Two-Week Highs
Oil prices moved slightly higher on Monday, trading near two-week peaks as investors expect a Fed rate cut to support economic activity and energy demand.
Brent crude rose 0.2% to $63.85 per barrel, while U.S. West Texas Intermediate futures increased 0.2% to $60.20. Both benchmarks ended Friday at their highest levels since November 18.
Beyond the Fed meeting, geopolitical factors also remain in focus. Progress toward peace in Ukraine is limited, and Reuters reported that the Group of Seven nations and the European Union are discussing replacing the Russian oil price cap with a full maritime services ban—a move that could further restrict Russian supply.
