How does the narrator set the mood of the story in the first page of "A Christmas Memory?"

From the very beginning the mood is nostalgic, comforting, and even happy.

Nostalgic: we know this is a memory. The narrator says, :"Imagine a morning..." and "The person to whom she is speaking is me. I am seven years old..." and "we are each others' best friend." All of these tell us this is not only a remembrance, but a fond one. He is looking back on this memory with love.

Comforting: the story begins in a kitchen which features a large stove, two rocking chairs, and a roaring fire. This sounds cozy and comfortable. Much of the story takes place here and the mood of the story is comforting. 

Happy: His friend proclaims that it is "fruitcake weather!" and we instantly feels as though we have something to look forward to, just as the characters do. The characters of Buddy and his friend are generally happy and this mood is set from the beginning.