NEW YORK (CNNMoney.com) -- U.S. stocks looked to rally at Monday's open, as major banks gained after historic new banking reforms were not as strict as some had initially expected.
Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures rose sharply ahead of the opening bell. Futures measure current index values against perceived future performance.
Rallies in global stock markets looked to give U.S. stocks a lift, on the news of the Basel III agreement -- a measure that would force financial institutions to more than double their capital reserves as a cushion protecting against future meltdowns.
But because the rules give financial institutions ample time to phase in the requirements, global stock markets welcomed the reforms, said David Jones, chief market strategist at IG Markets.
"There was a little bit of relief as it wasn't as bad as it could have been," he said.
European bank stocks rallied Monday, and before the U.S. stock market opened, shares of JPMorgan Chase (JPM, Fortune 500), Bank of America (BAC, Fortune 500) and Wells Fargo & Co (WFC, Fortune 500) all surged around 2% in pre-market trading.
The world's top central bankers pushed through the reforms after meeting in Basel, Switzerland over the weekend. The new rules would require financial institutions to increase their core capital cushions to at least 4.5% of assets, up from the current 2% -- but banks will have until 2019 until the rules come into full force.
Stocks were coming off modest gains after a light trading session on Friday, as ongoing worries about the economy dampened enthusiasm over an increase in wholesale inventories.
The economy will remain a key driver of stocks this week, with reports due on retail sales, initial claims for unemployment benefits, as well as consumer and wholesale inflation.
Investors are also likely to focus on tax policy this week as lawmakers return from recess. Congress is expected to work on possible legislation to extend the Bush tax cuts.
Companies: Hewlett-Packard (HPQ, Fortune 500) announced it has agreed to acquire cyber-security firm ArcSight Inc (ARST) for $1.5 billion, or $43.50 per share - a 24% premium over the stock's Friday closing price.
Shares of ArcSight surged more than 24% and HP rose 0.9% in pre-market trading Monday.
Rental car company Hertz Global Holdings (HTZ, Fortune 500) said Monday that it has raised its offer for Dollar Thrifty Automotive (DTG), to $50 per share, or $1.56 billion. Dollar Thrifty shares rose 4% in pre-market trading and Hertz rose 1.5%.
In April, Hertz originally offered to pay $1.2 billion to acquire its rival, but competing car rental company Avis (CAR, Fortune 500) later offered $1.36 billion for the company.
Economy: In a Saturday report, China reported stronger-than-expected growth in its industrial sector in August. Inflation in the country also accelerated last month, driven by rising food prices.
The data spurred China's central bank on Monday to set the yuan's daily reference rate at its highest level against the dollar since it scrapped its peg against the greenback in 2005.
New pressure has been building on China to let its currency increase in value. Treasury Secretary Timothy Geithner told The Wall Street Journal that China's decision in June to end its peg to the dollar was an "important step."
"But they've done very, very little, they've let it move very, very little in the interim," he said.
The Treasury Department is scheduled to release August budget numbers in the afternoon. Economists expect a deficit of $95 billion in the month, after a shortfall of $103.6 billion in July, according to consensus estimates from Briefing.com.
World markets: Bank issues helped European markets rally in midday trading. The CAC 40 in France rose 1.1%, the DAX in Germany climbed 0.9% and Britain's FTSE 100 added 1%.
Asian markets ended higher. Japan's benchmark Nikkei index rose 0.9%, the Hang Seng in Hong Kong surged 1.9% and the Shanghai Composite ended 0.9% higher.
Currencies and commodities: The dollar fell against the euro, the British pound and the Japanese yen.
Oil futures for October delivery rose 62 cents to $77.07 a barrel, after a leak forced officials to close a Chicago-area pipeline.
Gold for December delivery fell $2.20 to $1,244.30 an ounce.
Bonds: The yield on the 10-year Treasury note fell to 2.8% from 2.81% late Friday. 
| Overnight Avg Rate | Latest | Change | Last Week |
|---|---|---|---|
| 30 yr fixed | 3.80% | 3.88% | |
| 15 yr fixed | 3.20% | 3.23% | |
| 5/1 ARM | 3.84% | 3.88% | |
| 30 yr refi | 3.82% | 3.93% | |
| 15 yr refi | 3.20% | 3.23% |
Today's featured rates:
| Index | Last | Change | % Change |
|---|---|---|---|
| Dow | 32,627.97 | -234.33 | -0.71% |
| Nasdaq | 13,215.24 | 99.07 | 0.76% |
| S&P 500 | 3,913.10 | -2.36 | -0.06% |
| Treasuries | 1.73 | 0.00 | 0.12% |
| Company | Price | Change | % Change |
|---|---|---|---|
| Ford Motor Co | 8.29 | 0.05 | 0.61% |
| Advanced Micro Devic... | 54.59 | 0.70 | 1.30% |
| Cisco Systems Inc | 47.49 | -2.44 | -4.89% |
| General Electric Co | 13.00 | -0.16 | -1.22% |
| Kraft Heinz Co | 27.84 | -2.20 | -7.32% |
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