U.S. stocks were poised to start the trading week on a strong note Monday

as oil prices continued to decline and as investors looked ahead toward President Trump hosting China's President Xi on Thursday.

Ahead of the opening bell, the Dow, S&P 500 and Nasdaq were in positive territory thanks to a rally in chip makers and other AI-related stocks.

The improved sentiment comes amid hopes of diplomatic progress in the Middle East, which FFA Kings said contributed to the decline in oil prices. He added that this week's U.N. General Assembly would be an important catalyst.

On Sunday, Trump indicated he would be open to meeting Iranian President Masoud Pezeshkian at the U.N. summit.

"Credible progress toward de-escalation could drag oil lower, ease pressure on yields and reduce safe-haven demand for the dollar," FFA Kings said.

Looking ahead, provisional purchasing managers' surveys measuring September activity in U.S. manufacturing and services are due on Wednesday.

Other U.S. data due include weekly jobless claims and August new home sales on Thursday, followed by August preliminary durable goods orders data and the University of Michigan final September consumer sentiment survey on Friday.

Stocks to Watch

Advanced Micro Devices, Intel and Super Micro Computer rose 3.1%, 5.9% and 3.6% respectively as the AI trade continued to strengthen.

Paramount Skydance and Warner Bros. Discovery rose 6.7% and 7.9% respectively as Paramount executives were working on a possible settlement and concessions to clear the companies' merger.

Coinbase Global rose 5.3% and Robinhood Markets rose nearly 4% as Bitcoin rallied.

Watch For:

U.S. Chicago Fed National Activity Index for August

Today's Top Headlines/Must Reads:

- How Harley-Davidson, an American Icon, Became a Tariff Punching Bag

- Republicans Are Unleashing Their Fundraising Advantage Against the Democrats

- Refineries Are Now the Main Chokepoint for Global Energy Supplies

MARKET WRAPS Forex:

The dollar rose and has scope to rise further in the near term if markets assign a higher probability of the Federal Reserve raising interest rates again next month, ING said. It was stable against a basket of currencies as improved sentiment reduced safe-haven demand for the currency.

The euro fell slightly after Germany's ruling Christian Democratic Union party suffered losses in state elections. The loss, however, should have a limited impact on the currency, ING's Francesco Pesole said.

Bitcoin rose to an eight-month high, supported by progress in cryptocurrency regulation and a broad-based pickup in risk appetite.

Bonds:

Treasury yields eased as lower oil prices tempered inflation concerns and limited the dollar's upside.

Energy:

Oil fell, though were largely unchanged in midmorning European trading as the focus shifts to the U.N. General Assembly this week.

Metals:

Gold slipped as investors weighed inflation risks and the Federal Reserve's monetary policy outlook following last week's rate hike. "Gold remains caught between geopolitical and safe-haven support on one side and restrictive US monetary policy on the other, with the outlook for inflation and the pace of additional Fed hikes likely to remain the key drivers," said Soojin Kim from MUFG.

Copper rose on signs of stronger demand from China and broader supply-side concerns.

Iron ore prices were higher in early trading. Overall iron-ore shipments are continuing a seasonal upward trend, remaining at relatively high levels, according to Nanhua Futures.

TODAY'S TOP HEADLINES

Wegovy Maker Novo Nordisk Targets Several New Blockbuster Drugs in Coming Years

Novo Nordisk aims to launch several new blockbuster drugs in the next few years while expanding into further treatment areas, part of a new plan to revive growth that the Ozempic manufacturer outlined at an investor event in London on Monday.

In addition to at least five new "multiblockbusters," the company is aiming to have at least five new obesity and diabetes drugs and a similar number of drugs in other therapeutic areas in late stage trials by 2030.

Automakers Urge Trump Not to Allow Chinese Cars Into U.S. Ahead of Xi Summit

A coalition of auto-industry groups urged President Trump to keep Chinese cars out of the U.S. ahead of a meeting with leader Xi Jinping, saying any entry by Chinese newcomers would undermine jobs and national security.

In advance of Trump's state dinner next week with Xi, the group-including the Alliance for Automotive Innovation and the National Automobile Dealers Association-implored the president to "maintain policies that keep the door firmly shut to Chinese automakers seeking to sell, import or manufacture vehicles inside the U.S."

Disney Theme Parks Defy Industry Slump With Price Cuts and Promotions

Disney is defying the theme-park industry's summer slump by rolling out more promotions and package deals.

Thanks to special pricing at a Disney-owned hotel and discounts for using a Disney-branded Visa credit card, Doug Heyden Jr.'s family went to Walt Disney World's Magic Kingdom for the first time this summer. A highlight: watching Tinkerbell sprinkle pixie dust on his infant twins during an evening parade.

Volkswagen Warns on Profit After Big Porsche Write-Down

Volkswagen slashed its full-year profit forecast after flagging roughly $11.5 billion of impairment charges linked to its stake in Porsche, tough trading conditions in China and its restructuring efforts.

The German carmaker said Friday that it now expected an operating return on sales of up to 1% this year, down from its prior estimate of between 4% and 5.5%. The new forecast, announced just before the market closed in Germany, sent Volkswagen shares down more than 5%.

China is chasing SpaceX and setting its sights on the global space economy

While SpaceX prepares to put its Starship rocket in orbit for the first time, foreign countries including China are looking to develop their own technology to rival Elon Musk's company.

SpaceX's SPCX ascent in the rocket-launch industry has pushed China to pursue swift progress of its own, according to experts. And, with China gaining ground, homegrown companies there could start competing with SpaceX before long.

A Shortage of Oil Tankers Is Threatening to Keep Gas Prices High

The Iran war has created a new shortage on the oil market. This time the scarce commodity isn't just crude-it is the ships that carry it.

Drone attacks that shut Saudi Arabia's bypass pipeline earlier this month have forced more crude back through the Strait of Hormuz and onto a tanker fleet already stretched thin. The impact has spread worldwide, as longer voyages and shuttle runs around Hormuz tie up ships and push the daily rate of hiring oil tankers to records.

The Silver Lining in Soaring Interest Rates: The Economy Can Handle Them

Some economists see a silver lining to the global surge in borrowing costs: the economy is strong enough to handle them.

Economies around the world are showing surprising resilience to higher central bank-interest rates and government bond yields that have jumped to multidecade highs across the developed world. The Federal Reserve, Bank of Japan and European Central Bank are among central banks that have lifted interest rates to contain inflation driven by the war with Iran.

Trump Ramps Up Bid to Dismantle International Criminal Court

The Trump administration is preparing to impose sweeping sanctions on the International Criminal Court, according to officials, a sharp escalation in Washington's efforts to dismantle the institution after it issued an arrest warrant for Israeli Prime Minister Benjamin Netanyahu.

The sanctions would forbid most transactions with the ICC after a grace period of six to seven months, according to documents viewed by The Wall Street Journal and U.S. officials. That could potentially cripple the court by prohibiting it from conducting transactions in U.S. dollars, cutting it off from much of the global financial system.

Trump's Greenland Deal Eases Way for U.S. Business on Arctic Island

The security deal over Greenland, announced by President Trump on Friday, relieves the pressure from months of American maneuvering to control the semiautonomous Danish territory and smooths the way for more U.S. investments on the cash-starved but resource-rich Arctic island.

American and Greenlandic businesspeople say they hope the agreement, which is expected to be signed this week, will ease geopolitical tension, drive investment and remove some of the stigma many Greenlanders attach to cooperating with the Americans.

Wave of Setbacks Leaves Trump Frustrated and Looking for Credit

WASHINGTON-President Trump wants a little gratitude.

At a recent closed-door meeting in the Oval Office, the president expressed deep frustration to advisers that prominent figures in Washington hadn't publicly thanked him for trying to overhaul the Kennedy Center, according to a senior administration official.

Write to nina.kienle@wsj.com

TODAY IN CANADA Earnings:

Nothing major scheduled.

Economic Indicators (ET):

1000 Halifax Partnership luncheon with Bank of Canada Governor Tiff Macklem speaking

Stocks to Watch:

InMed Pharmaceuticals Gets Nasdaq Notification That It Was Below Required $2.5M Shareholders' Equity

Expected Major Events for Monday 08:30/UK: 2Q Business Finance Review

08:30/UK: S&P Global UK Consumer Sentiment Index

10:00/UK: Aug Aluminium Production report

12:30/US: Aug Chicago Fed National Activity Index (CFNAI)

All times in GMT. Powered by Onclusive and Dow Jones.

Expected Earnings for Monday Eco (Atlantic) Oil & Gas Ltd (EOG.V) is expected to report for 1Q.

Ennis Inc $(EBF)$ is expected to report for 2Q.

Espey Manufacturing & Electronics Corp (ESP) is expected to report $0.92 for 4Q.