• APAC stocks traded mostly in the green following a modestly positive lead from Wall Street
• The final Presidential Debate prompted little market action, but was overall structured, civilised and touched upon policy
• US President Trump said a COVID-19 vaccine is ready and will be announced in the coming weeks, but it is not a guarantee; Gilead’s Remdisivir received FDA approval
• NEC Director Kudlow said differences in COVID relief talks between the White House and House Democrats are not likely to get resolved
• China's FX regulator said the CNY is more stable than expected and has maintained relatively high flexibility
• In FX, DXY reclaimed 93.000, EUR/USD traded on either side of 1.1800, JPY modestly outperformed
• Looking ahead, highlights include UK Retail Sales, EZ, UK & US PMIs (Flash), CBR Rate Decision; S&P reviewing Greece, UK & Italy
• Earnings include Daimler, ENI, Barclays & ABB

PRESIDENTIAL DEBATE

Markets saw little reaction to the final Presidential Debate with US equity futures, the Dollar and UST futures steady throughout the whole broadcast as the two participants largely stuck to their scripts. Overall, the debate was structured and civilised with the two candidates sticking to the two-minute rule and touching upon a range of topics including the fight against COVID-19, national security, the economy alongside race and climate.

For all the market-relevant comments from the debate click here

In terms of highlights, US President Trump said a COVID-19 vaccine is ready and will be announced in the coming weeks, but it is not a guarantee. President Trump said Johnson & Johnson (JNJ), Moderna (MRNA) and Pfizer (PFE) are doing very well. Democratic Candidate Biden did not rule out future shutdowns and said measures need to be implemented to confront the virus, whilst resources are needed to open safely.

On national security, Biden said any country interfering with US elections will pay a price, and on China policy, said he will make China play by international rules, whilst a meeting with North Korea will only happen if they reduce nuclear capacity. President Trump said US has a very good relationship with North Korea, whilst stating that China devalued their currency.

On US stimulus, President Trump reiterated House Speaker Pelosi does not want to approve stimulus, to which Biden responded Republican leader in the Senate said he cannot pass stimulus.

Instant poll among debate watchers - CNN: 53% Biden won the debate vs 39% for Trump. YouGovAmerica: Biden 54% vs Trump 35%. Data Progress: Biden 52% vs. Trump 41% (Twitter)

CORONAVIRUS UPDATE

Gilead (GILD) received FDA approval for Remdesivir. (Newswires)

Infusing hospitalized COVID-19 patients with blood plasma from people who recovered from the disease had no effect on whether patients got sicker or died, according to the first completed randomized trial of the treatments, according to Stats News. (Stats News)

Moderna (MRNA) representative speaking at FDA vaccine committee says it will share the outcomes of its interim analyses around Nov. 24/25, according to Politico. (Politico)

New York COVID stats: Cases +1,628 (prev. +2,026); positivity rate 1.2% (prev. 1.62%), Hospitalisations 986 (prev. 950); deaths +15 (prev. +7), (Newswires)

UK reported 21,242 (prev. +26,688) new COVID-19 cases, and 180 (prev. +191) additional deaths. (Newswires) UK Chief Scientific adviser Vallance reiterated things progressing well on vaccine, possibility of widespread vaccine rollout not until next Spring, adds may have a few doses this side of Christmas. (Newswires)

Germany reported 11,242 (Prev. 11,287) new COVID-19 cases and 49 (Prev. 30) additional deaths, according to RKI. (Newswires)

ASIA

Asia-Pac equities traded mostly higher after a lukewarm handover from Wall Street whereby all three majors closed in the green but the Nasdaq narrowly underperformed amid losses across the tech sector, whilst Intel shares slumped almost 10% after-hours post-earnings amid new weakness in its data center business. US equity futures reopened with mild gains before drifting modestly lower during the Presidential Debate, albeit with no explicit comment driving price action at the time as the two candidates stuck to their respective scripts. Thereafter, following the more sanguine debate, ES, NQ and YM nursed losses to trade higher by 0.1-0.2%. ASX 200 (flat) remained the laggard as the index was subdued by its mining sector. Nikkei 225 (+0.4%) extended on gains despite the firmer Yen, with outperformance in the industrial names, whilst Mitsubishi Heavy Industries stood as the outperformer amid source reports the group is closer to a final decision on freezing regional Spacejet program. KOSPI (+0.3%) traded between gains and losses before gaining a firmer footing in positive territory. Hang Seng (+0.6%) and Shanghai Comp (+0.2%) eked mild amid another PBoC liquidity operation, whilst comments from Chinese President Xi did little to sway the indices. Finally, 10yr JGB futures continued to track the broader fixed income futures complex.

PBoC sets USD/CNY midpoint at 6.6703 vs. Exp. 6.6735 (Prev. 6.6556). (Newswires) PBoC injects a net CNY 20bln via 7-day reverse repos at a maintained 2.20% rate. PBoC injected CNY 220bln for the week via open market operations.

China's FX regulator said the CNY is more stable than expected and has maintained relatively high flexibility; CNY will still fluctuate around a reasonable balanced level. China will step up monitoring of inbound and outbound cross border capital flows. (Newswires)

China is moving a step closer to easing capital controls within the Greater Bay Area by setting the amount of fund flows allowed under an investment scheme with Hong Kong and Macau from early next year. (SCMP)

EU reportedly threatens to implement tariffs on aluminium converter foil from China. (Newswires) Chinese Commerce Ministry says it will impose temporary anti-dumping measures on some rubber imports from US, EU and South Korea from Oct 28. (Newswires)

Japanese government expert panel proposes extending New Year holiday to Jan 11th, according to Kyodo. (Newswires)

Japanese CPI, Core Nationwide YY (Sep) -0.3% vs. Exp. -0.4% (Prev. -0.4%) (Newswires) Japanese CPI Index Ex Fresh Food* (Sep) 101.3 (Prev. 101.3)

New Zealand CPI QQ (Q3) 0.7% vs. Exp. 0.9% (Prev. -0.5%) (Newswires) New Zealand CPI YY (Q3) 1.4% vs. Exp. 1.7% (Prev. 1.5%)

UK/EU

UK Trade Secretary Truss said she is confident a trade deal can be struck with the US regardless who wins the US election. (Newswires)

UK and Japan have formally signed the trade deal agreed last month. (Newswires)

FX

In FX, DXY traded firmer in what was continuation of the prior session’s gains and reclaimed a footing above 93.000 in what seemed to be early risk-related flows as G10s (ex-JPY) saw broad downside. From a technical standpoint, the index sees its 50 DMA at 93.259, followed by the psychological 93.500 and the 21 DMA at 93.527. The Dollar’s gains at the time prompted EUR/USD to dip below its 50 DMA (1.1795) after the pair fell below the 1.1800 barrier and its 100 HMA and a Fib level both at 1.1806, however the pair later stabilised around the round figure. GBP/USD meanwhile saw an overall flat session after initially inching towards 1.3050, and with its 50 DMA residing around 1.3013. The Japanese Yen saw resilience in the face of early USD strength - USD/JPY remained sub-105.00 after retesting yesterday’s 104.90 high. Antipodeans narrowly outperformed with initial AUD/USD gains coinciding with the Aussie PMI figures which showed the services and composite metrics improving whilst manufacturing missed but remained in healthy expansionary territory. AUD/USD found an overnight base at its 100 DMA at 0.7106 USD, whilst NZD/USD traded on either side of 0.6650 and saw no follow through from the softer-than-expected CPI figures. USD/CNH meanwhile saw some upside as the PBoC opted for a weaker Yuan fix, but thereafter traded steady as China's FX regulator said the CNY is more stable than expected and has maintained relatively high flexibility.

COMMODITIES

WTI and Brent front month futures remained steady overnight amid a lack of complex-specific news flow. The benchmarks continued the holding pattern within USD 0.3/bbl-range seen since European players left yesterday. Since then, Russian President Putin alluded to further output curbs if needed but noted that there is no need for that yet – albeit prices derived little traction from these comments. Elsewhere, spot gold and silver were largely uneventful with the former moving sideways just above the USD 1900/oz mark, whilst spot silver hit overnight resistance at USD 24.75 before stabilising near the level. Copper futures also flatlined overnight.

Russia President Putin said we will follow recovery of markets, adding we do not rule out keeping existing curbs on oil output. We could decide to further curb output if necessary, but we do not see the need for that yet. (Newswires)

US Democratic Candidate Biden's campaign reportedly told US miners it supports bolstering domestic metal production used in electric vehicles, sources stated. The stance is seen as boosting Glencore (GLEN LN) and Antofagasta (ANTO LN) copper units in US. (Newswires)

GEOPOLITICS

Chinese President Xi said China will not allow anybody or any force to separate China's territory. (Newswires)

US sanctioned three new Iranian organisations in relation to alleged disinformation campaign - sanctions include five Iranian institutions, including the Revolutionary Guard according to Sky News Arabia. (Newswires/Twitter)

US intelligence agencies reportedly expect Russia are planning to interfere with the election race in its final days or imminently after, according to New York Times. (NYT) US President Trump and Intelligence Chief are pushing to rapidly declassify a document disputing the 2017 US finding that Russia acted to help elect Trump, according to sources. (Newswires)

Russian President Putin, on the Armenia-Azerbaijan conflict, said Turkey's President Erdogan may seem tough but he's a flexible politician and a reliable partner for Russia. (Newswires)

EU imposed sanctions on Russia's head of military intel over 2015 German parliament hack. (Newswires)

US

Treasuries continued to bear-steepen amid positive jobless data and stimulus hopes being upheld. By settlement, 2s +0.6bps at 15.5bps, 10s +3.4bps 85bps, and 30s +3.5bps 166.4bps; futures volumes were decent. The majority of the UST selling happened in the transatlantic cross-over, coinciding with optimistic commentary, again, from the White House/Pelosi, as well as better than expected prints in both the Initial and Continuing Claims prints, boding well for October payrolls data. There was potentially some supply pressures at work too, where the Treasury announced it would be selling 54bln of 2-year notes, 55bln of 5-year notes, and 53bln of 7-year notes next week, in addition to 26bln in 2-year FRN’s next week. Meanwhile, today’s USD 17bln 5-year TIPS auction went down to little fanfare, stopping through the screws at -1.32%. More broadly, there have now been six straight sessions of rising long-end yields, which hasn’t been seen since the March dash for cash, and otherwise, hasn’t occurred in the past year, at least. Admittedly it’s only been a 15bps rise in the 30Y in that time, but in the wake of equity/risk-tone turbulence, the bear-steepening trend has been solid; of course, it’s natural for the curve to re-steepen as investors build confidence at the beginning of a new cycle, which appears to be forming, with many tying this to the expectation of stimulus, at some point in the near future regardless of the current impasse in Congress. T-note (Z0) futures settled 8 ticks lower at 138-10+

NEC Director Kudlow said there are still policy differences between stimulus negotiations, and President Trump still does not want to bail out poorly run states in the COVID stimulus bill larger policy. Differences in COVID relief talks between the White House and House Democrats are not likely to get resolved. (Newswires)

White House Chief of Staff Meadows says COVID-19 relief talks have entered a new phase with committee chairs looking at language, President Trump is willing to go bigger on a deal - including direct payments to families, via CNN. (Newswires)

US House Speaker Pelosi said Democratic lawmakers are telling her they do not want a pre-election vote on a potential relief bill unless the Senate is going to take it up before the election, via Politico's Sherman. (Twitter)

Sen. Sanders is hoping to be a part of Biden’s potential administration; has expressed an interest in becoming Labor secretary, Politico reports. (Politico)

Intel (INTC) Q3 2020 (USD): Adj. EPS 1.11 (exp. 1.11); Revenue 18.3bln (exp. 18.25bln). Raises FY guidance. Client Computing Group: 9.8bln (exp. 8.93bln). Data Center Group: 5.9bln (exp. 6.07bln). (Newswires) Shares fell 9.6% after market.

Facebook (FB) - A federal antitrust probe targeting Facebook appears to have entered its late stages, according to sources cited by WaPo. (Washington Post)

Wells Fargo (WFC) is reportedly mulling the sale of its asset management business which could fetch over USD 3bln, according to sources. (Newswires)