Global markets are rallying

Global markets are rallying strong on Monday morning.

Near 8:02 a.m. ET, US indexes were up more than 1% across the board in futures trading, with Dow futures up 171 points, S&P 500 futures up 19 points, and Nasdaq futures up 46 points.

In Europe, the DAX in Germany and the FTSE in London were up by more than 1%, while the benchmark Euro Stoxx 50 rallied 2.2%.

Meanwhile, the British pound is tanking, down more than 2% to $1.4058 in its biggest drop against the dollar since 2010. The drop came after news Sunday that Mayor Boris Johnson of London would campaign for Britain to leave the European Union.

This adds to uncertainty about the country’s future within the bloc, with several analysts agreeing that a so-called Brexit would be economically negative for Britain and the EU.

And as is becoming standard practice, crude oil is sharply higher with stocks. West Texas Intermediate crude futures jumped 4% to as high as $33 per barrel in New York, a level it has not reached in about three weeks.

“For now, there’s enough two-way action in crude oil prices to suggest that we may be forming a messy base, replacing a downtrend with range-trading at least,” wrote Kit Juckes at Societe Generale in a note.

In other words, the worst of the market volatility may be over.

But not so if you share John Hussman’s view that stocks could fall as much as 50% from the peak in a way that won’t happen suddenly. As Business Insider’s Henry Blodget argued over the weekend, the same factors that inspired the drop — overvaluation and risk aversion — still linger.

So, the bottom line is no one really knows.

For now, though, stocks are extending gains following the four-day trading period last week that was the best for the market this year.

In economic data, Markit’s flash manufacturing PMI crosses at 9:45 a.m. ET.

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