Market Snapshot: S&P 500 could see a record session after U.S., Canada reach Nafta deal

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The S&P 500 was poised to hit a record on Monday after the U.S. and Canada reached a last-minute deal to revise the North American Free Trade Agreement..

How are major benchmarks trading?

Dow Jones Industrial Average futures YMZ8, +0.78%  jumped 168 points, or 0.6%, to 2,934.50, while S&P 500 futures ESZ8, +0.63% rose 14.25 points, or 0.5%, to 2,933.25. Nasdaq-100 futures NQZ8, +0.77%  gained 46.75 points, or 0.6%, to 7,702.

The S&P 500 SPX, +0.00% index closed modestly lower Friday, but just 0.57% off its record close of 2,930.75 on Sept. 20. The Dow DJIA, +0.07% and Nasdaq Composite Index COMP, +0.05% finished modestly higher on Friday.

The S&P 500 polished off its best quarter since the end of 2013, climbing more than 7% in the third quarter. The Dow advanced 9%, with both indexes rising in 11 of the past 12 quarters. The Nasdaq gained more than 7% over the quarter, up for its ninth straight quarter.

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What is driving trading?

The fourth quarter was kicking off with upbeat news on the trade front after a surprise breakthrough in U.S. and Canada negotiations.

Just four days ago, Trump’s trade representative Robert Lighthizer told Congress that chances were slim that a Canada deal would be reached in time to meet a U.S.-imposed Sunday-night deadline. While trade headlines have at times produced short-term reaction for stocks, investors have persistently shrugged off those concerns, choosing to focus on data and earnings instead.

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This week’s key economic data will likely be September employment numbers. Before that on Monday, the markit manufacturing purchasing managers index for September will be released at 9:45 a.m. Eastern Time, followed by the Institute for Supply Management’s manufacturing index for September and construction spending for August, both due at 10 a.m. Eastern.

Investors will hear from several Federal Reserve speakers Monday — Atlanta Fed President Raphael Bostic at 9 a.m. Eastern Time, Minneapolis Fed President Neel Kashkari, who will take part in a moderated discussion in Minnetonka, Minn at 11 a.m. Eastern and Boston Fed President Eric Rosengren speech on outlook for the economy and monetary policy in Boston at 12:15 p.m. Eastern.

Italy may also be in the spotlight after its antiestablishment government significantly widened its budget-deficit target for next year, potentially setting the country on a collision course with the European Union. In the U.K., the Conservative annual party conference was getting underway with Prime Minister Theresa May under pressure over her proposal for future U.K.-EU relations, known as the Chequers plan, which has already been rejected by EU leaders.

See: Italy’s budget turmoil: Here’s what it will take to rattle global markets

What were analysts saying?

“The trilateral agreement brings an end to months of uncertainty surrounding North American trade,” said Jasper Lawler, head of research at London Capital Group.said Jasper Lawler. “The resultant risk on sentiment has seen equity futures rally overnight.“

What stocks are in focus?

Tesla Inc. TSLA, -13.90% could be active after Chairman and Chief Executive Elon Musk reportedly told employees in a weekend email that the electric-car maker is on the verge of making a profit. The email came hours after Musk settled a Securities and Exchange fraud probe, that will force him to step down as chairman and cost he and the company $40 million in fines.

Shares plunged 14% on Friday, the biggest daily decline since Nov. 6, 2013 on news of that SEC lawsuit, which alleged Musk he misled investors over his tweet that said he was considering taking the company private.

Shares of MEG Energy Corp. MEG, +5.80%  could be active after Calgary-based Husky Energy Inc. HSE, +1.02%  said it has made an unsolicited bid to buy the oil-sands producer.

How are other markets doing?

Chinese and Hong Kong markets were closed for holidays, while the Nikkei 225 index NIK, +0.52%  rose 0.5%. European stocks opened mixed.

The Canadian dollar USDCAD, -0.7746%  powered ahead on the trade-deal news, with one dollar last buying C$1.2835, down from C$1.2911 late Friday in New York. The Mexican peso also climbed against the dollar USDMXN, -0.9934% jumping to 18.5680 pesos from 18.7135 late Friday in New York.

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