Wall Street was set to open higher on Monday after the United States and Canada clinched a last-minute deal to save NAFTA as a trilateral pact with Mexico, raising hopes for progress in talks with other countries at the start of the fourth quarter.
The relief lifted world markets after the new United States-Mexico-Canada Agreement (USMCA) rescued a $1.2 trillion open-trade zone on Sunday.
U.S. President Donald Trump coerced Canada and Mexico into accepting more restrictive commerce with their main export partner in a deal that will make it harder for global auto makers to build cars cheaply in Mexico and aims to bring more jobs to the United States.
Shares of U.S. carmakers advanced with Ford rising 2.1 percent and General Motors 2.5 percent.
Leading advancers on the 30-member Dow Jones Industrial Average were trade sensitive stocks, Boeing and Caterpillar, up 1.0 percent and 1.4 percent respectively.
"Anything positive relating to trade has always buoyed the markets so its not surprising to see a bounce," said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin.
Market reaction to these developments are relatively short-lived, but the economics in the market are very strong and only concerns about the trade issues have been holding the market back from moving higher, Frederick added.
Among other stocks, Tesla shares soared 16.4 percent before the bell after Elon Musk agreed to step down as the company's chairman, but remain as chief executive in a settlement with the U.S. Securities and Exchange Commission on Saturday.
General Electric shares climbed 14.3 percent after Chief Executive Officer John Flannery stepped down and the company announced a $23 billion charge related to its power business.
At 8:17 a.m. ET, Dow e-minis were up 188 points, or 0.71 percent. S&P 500 e-minis were up 16.5 points, or 0.57 percent and Nasdaq 100 e-minis were up 51.25 points, or 0.67 percent.
Among the decliners, chipmakers Intel fell 1.3 percent, while AMD dipped 1.3 percent after brokerage downgrades.
This week ends with the Labor Department's non-farm payrolls report and focus may also shift towards the start of the financial reporting season later this month.
Bolstered by a growing economy, deep corporate tax cuts and increased stock buybacks, S&P 500 companies are expected to post 21.6 percent increase in earning per share from a year earlier, according to Thomson Reuters I/B/E/S.
ISM's national factory activity index at 10:00 a.m. ET is expected to show a dip to a reading of 60.3 in September from 61.3 in August, still showing the economy growing strongly.
Separately, the U.S. Commerce Department is forecast to report that construction spending increased 0.5 percent in August after edging up 0.1 percent in July.