It looks like the bulls have gained the upper hand in the U.S. stock market, with shares advancing for their third straight week in a row, following an impressive jobs report on Friday that showed recent economic worries were overblown. The S&P 500 has now gained in 10 out of 15 sessions since its Feb. 11 low, and closed last week above its 100-day moving average for first time in 2016. But the question remains - where will equities go from here? Further gains are possible if the ECB expands its stimulus measures this week, but more upbeat U.S. data could bolster prospects for an upcoming rate hike from the Fed and weigh on shares.

Economy

International capital markets are thawing out for spring as volatility eases and money flows into bond funds. U.S. high yield spreads (along with the S&P 500) have now returned to levels last seen at the start of January, with investors pouring $5.8B into junk bonds for the week ending March 2, the largest weekly amount on record. Improving secondary markets have tempted borrowers to return. ExxonMobil (NYSE:XOM) priced its biggest bond deal ever last week, raising $12B. It followed Johnson & Johnson (NYSE:JNJ), which raised $7.5B the previous week, as well as Cisco Systems' (NASDAQ:CSCO) $7B deal.

Negative interest rates are not always being passed on to businesses and consumers, and could ultimately undermine the models of banks, pension funds and insurance companies, the Bank for International Settlements has warned. The BIS, known as the central banks' central bank, says the longer reference rates are set at zero or below, the higher the risk of hitting a "tipping point," where no one benefits. The warning comes as central banks around the world increasingly look to sub-zero short-term rates to stimulate economic activity and fight off deflationary pressures.

"China will absolutely not experience a hard landing" predicted by the likes of George Soros as policy makers still have enough tools to maintain reasonable growth, the country's top economic planner, Xu Shaoshi, told reporters at the National People's Congress. The statement comes after China officially reduced its economic growth estimate for this year to a range of 6.5%-7%, after expanding 6.9% (its slowest pace in a quarter of a century) in 2015. Chinese premier Li Keqiang also sought at the weekend to balance conflicting goals of stimulating China's economy and reforming it.

Meanwhile, China's foreign currency reserves dropped for the fourth consecutive month in February, falling $28.75B to $3.2T (the lowest level since 2011), but a slower pace of decline suggested that the recent stability of the currency markets has eased pressure on the central bank to intervene aggressively. The country's forex reserves have come under close scrutiny in recent months for clues on the size of capital outflows as well as the ability of policymakers to support the yuan.

North Korea is threatening a "pre-emptive and offensive nuclear strike" against South Korea and the U.S. mainland, as the two allies prepare to kick off this year's large-scale joint military drills. The warning comes just days after leader Kim Jong-Un ordered the country's nuclear arsenal to be placed on standby for use "at any time" in response to tough new U.N. sanctions against its nuclear program.

German factory orders fell for a second month in January in a sign that a global slowdown and weak domestic pricing power may be hurting Europe's largest economy. Data from Berlin's economy ministry showed that orders, adjusted for seasonal swings and inflation, dropped 0.1% from the prior month, when they slid 0.2%. While Germany is benefiting from record-low unemployment that's boosting domestic demand, corporate confidence has been hit by market volatility and concerns that the eurozone's recovery might fade.

European and Turkish leaders are gathering in Brussels for an emergency summit as the region fails to muster a collective response to the ongoing migrant crisis. The meeting will focus on how Turkey is spending €3B ($3.3B) worth of EU aid to stem the flow of evacuees coming to Europe, and is also expected to ask the country to take back thousands of people who are deemed "economic migrants" rather than "refugees."

What's going on with Greece's bailout? The country's warring creditors will attempt to bridge their differences at a meeting of eurozone finance ministers today amid mounting concerns that Athens' €86B third bailout is heading for another crisis. The EU and the IMF are at loggerheads over the strength of reform measures that must be adopted before the eurozone will consider granting Greece debt relief, and entire the rescue could also fall apart due to the lack of the IMF's formal participation.

A British vote to leave the European Union would damage the British, European and global economies, German Finance Minister Wolfgang Schaeuble said in an interview with the BBC. "We would have years of the most difficult negotiations, which would be very difficult for the EU as well. And for years we would have such insecurity that would be a poison to the economy." Schaeuble added that the EU would be weaker without Britain, but said the bloc would "not commit suicide."

Stocks

The head of Commerzbank's retail unit is set become chief executive, succeeding one of the very last acting leaders of a European bank that tapped taxpayers during the financial crisis. Martin Zielke will take the reins from CEO Martin Blessing on May 1, a move that will see both of Germany's largest lenders change chief executives in less than a year. Commerzbank (OTCPK:CRZBY) shares have plunged more than 30% over the past 52 weeks.

After a massive 121% advance during the previous session - following reports that investors were covering short bets on bailout speculation - Seadrill (NYSE:SDRL) shares are giving back their gains. "It's short-covering within the industry - the entire rig sector is heavily shorted," said Lukas Daul, an analyst at ABG Sundal Collier. The company's main owner, billionaire John Fredriksen, raised $510M in cash last week, fueling discussions about a bailout. SDRL -26% premarket.

Other big movers in Europe: Old Mutual (OTC:OLMUY) surged 12% in London after saying it was considering all business options as part of a strategic review. The statement followed a weekend Sky News report stating Africa's biggest insurer was plotting a £9B ($12.7B) break-up. Electricite de France (OTCPK:ECIFY) fell 6.5% following the resignation of CFO Thomas Piquemal over a decision to build two nuclear reactors in Hinkley Point, England. Mexican billionaire Carlos Slim pushed shares of FCC (OTCPK:FMOCY) 15% higher after launching a full takeover bid for the Spanish building and infrastructure company.

Talks for Taiwan's Foxconn to acquire a majority stake in Sharp (OTCPK:SHCAY) are "on the right track," sources told Reuters, adding that the discussions are set to conclude this week and that most of the due diligence is now done. Sharp shares closed up 7.3% in Tokyo on the news. Foxconn (OTC:FXCOF) late last month suspended the signing of a $6B deal to take over the loss-making Japanese electronics firm, citing the emergence of new material information.

SoftBank plans to separate itself into two companies, one focused on its slow-growing domestic telecommunications business and the other looking after its collection of overseas technology investments. Ex-Google (GOOG, GOOGL) executive and SoftBank (OTCPK:SFTBY) President Nikesh Arora will lead the overseas management arm, while Ken Miyauchi, who is in charge of the company's mobile business, will be heading the domestic firm. Both divisions will be based in Japan.

The U.S. government has proved in the past decade that it can stop Chinese companies from buying American ones, but it can also eviscerate a Chinese firm's business by blocking access to American technology. That is the significance of reports that the U.S. Commerce Department may restrict exports of American products to Chinese telecommunications equipment maker ZTE (OTCPK:ZTCOY). The company, which suspended its Hong Kong-listed shares today, may have violated U.S. export rules on Iran.

After quietly dropping an encryption option on its Fire tablets, Amazon (NASDAQ:AMZN) is restoring the security feature amid criticism from customers and privacy advocates. "We will return the option for full-disk encryption with a Fire OS update coming this spring," company spokeswoman Robin Handaly told Reuters via email. The decision comes as Apple (NASDAQ:AAPL) squares off against the FBI over access to the encrypted iPhone used by one of the San Bernardino shooters.

BASF is working with advisers and banks to examine the merits of making a counter bid for DuPont (NYSE:DD), which previously agreed to a merger with Dow Chemical (NYSE:DOW), Bloomberg reports. BASF (OTCQX:BASFY) is said to have held talks with DuPont before the merger agreement with Dow, but the talks did not progress.

A SpaceX Falcon 9 rocket blasted off from Cape Canaveral on Friday night, successfully thrusting a communications satellite into orbit, but the launch vehicle's reusable main-stage booster was destroyed when it failed to land itself on an ocean platform. It marked the fourth botched at-sea return landing attempt for Elon Musk, though a Falcon main-stage rocket did achieve a successful ground-based touchdown after soaring back to Earth from a less demanding launch in December.

Frontier Airlines took another step toward an IPO by hiring underwriters, sources told Bloomberg. The company reportedly has Barclays, Deutsche Bank, and JPMorgan working on the planned public offering of shares. An IPO by Frontier would be the first in the U.S. airline sector since Virgin America (NASDAQ:VA) went public in 2014 to join Spirit Airlines (NASDAQ:SAVE) and Allegiant Travel (NASDAQ:ALGT) as publicly-traded ultra low-cost carriers.

United Continental CEO Oscar Munoz is planning to return to the carrier on a full-time basis on March 14. Munoz suffered a heart attack in October, just weeks after taking the helm of the airline, and underwent a heart-transplant operation in early January. United (NYSE:UAL) general counsel Brett Hart has been acting as CEO during Munoz's medical leave, although the latter did take part in decisions, and held meetings during his recovery.

In an interview with Germany's Wolfsburger Allgemeine Zeitung, Volkswagen's (OTCPK:VLKAY) brand chief Herbert Diess said it will take months rather than weeks to reach an agreement with U.S. regulators on an emissions fix for 600K diesel cars. U.S. District Judge Charles Breyer turned up the heat on VW in February by setting a March 24 deadline for the automaker to state whether it has found a fix that is acceptable to American authorities.

Wells Fargo is hunting for a new head of M&A to succeed John Laughlin, who has moved into a vice chairman role, in a bid to boost its dealmaking franchise. While Wells (NYSE:WFC) has seen its stock price and return on equity rewarded for focusing on wealth management and Main Street lending, this latest move reflects a desire to build out its investment banking franchise.

According to the World Health Organization, about 15 companies are working on Zika vaccines, most in the initial stages. It's still a long way to go. Under the best-case scenario, officials estimated it will take until roughly the end of 2017 to just gather enough data from trials for regulators. Drugmakers Sanofi (NYSE:SNY), Inovio Pharmaceuticals (NASDAQ:INO) and NewLink Genetics (NASDAQ:NLNK) are among those who are developing treatments for the virus, while companies including Chembio Diagnostics (NASDAQ:CEMI) are working on new diagnostic tests.

More troubles in Brazil? McDonald's (NYSE:MCD) and franchise operator Arcos Dorados Holdings (NYSE:ARCO) are the targets of a civil investigation by a federal prosecutor in the country. Labor groups in the nation continue to raise issues against the companies that range from labor violations to tax evasion, and the practices of franchisees buying ingredients from exclusive providers is also under scrutiny.

Today's Markets

In Asia, Japan -0.6% to 16911. Hong Kong -0.1% to 20159. China +0.8% to 2897. India closed.
In Europe, at midday, London -1%. Paris -1%. Frankfurt -1%.
Futures at 6:20, Dow -0.3%. S&P -0.4%. Nasdaq -0.5%. Crude +1.4% to $36.43. Gold +0.1% to $1271.60.
Ten-year Treasury Yield +2 bps to 1.90%

Today's Economic Calendar

8:30 Gallup US Consumer Spending Measure
10:00 Labor market condition index
12:30 PM TD Ameritrade IMX
3:00 PM Consumer Credit