• APAC stocks traded higher as the region took impetus from the rally on Wall St (SPX +1.91%).
• European equity futures are indicative of a higher open with the Euro Stoxx 50 future +0.6% after the cash market closed up 0.2% yesterday.
• DXY reclaimed 113 status with majors broadly softer vs. the greenback, GBP lags after Cable encountered resistance around 1.09. 
• 10yr UST futures eased from this week’s highs as yesterday’s Gilt-driven rally faded.
• Looking ahead, highlights include EZ Economic Sentiment, German HICP (Prelim.), US PCE Prices Final, IJC, Banxico Policy Announcement Speeches from ECB's Panetta, de Guindos, Elderson, Lane & de Cos, BoEs Ramsden, Fed's Bullard & Mester, Supply from Italy.

US TRADE

• US stocks rallied as the BoE's decision to restart Gilt purchases reduced UK contagion risks and buoyed risk sentiment. US Treasuries catapulted higher on the BoE's intervention with bids also aided by a strong 7yr auction and resulted in the largest fall in yields since 2009.
• SPX +1.91% at 3,716, NDX +1.97% at 11,493, DJIA +1.88% at 29,683, RUT +3.17% at 1,715.
• Click here for a detailed summary.

NOTABLE HEADLINES

• Fed's Evans (departing, non-voter) said he expects to be at the terminal Fed Funds Rate by March.
• White House said US President Biden's economic team reported that the US economy remains resilient in the face of global challenges, while President Biden directed his economic team to stay in touch with allies and key market actors, as well as brief him regularly on global financial and energy markets, according to Reuters.
• US Senate Minority Leader McConnell said the stopgap funding bill should pass in the next day or two, according to Reuters.

APAC TRADE

EQUITIES

• APAC stocks traded higher as the region took impetus from the rally on Wall St where risk sentiment was buoyed and yields retreated following the BoE's announcement to resume Gilt purchases.
• ASX 200 outperformed in which the commodity-related sectors led the broad advances across industries following the recent upside in energy and metal prices, while firm monthly CPI data did little to dent risk sentiment.
• Nikkei 225 was also positive but with gains initially capped as more than half of the stocks traded ex-dividend.
• Hang Seng and Shanghai Comp were also firmer with the Hong Kong benchmark spearheaded by tech and energy stocks, while the mainland also digested reports that the PBoC is setting up a more than CNY 200bln re-lending facility quota for equipment upgrades which aims to expand market demand in the manufacturing sector.
• US equity futures traded flat and held on to yesterday's spoils following the BoE's policy pivot.
• European equity futures are indicative of a higher open with the Euro Stoxx 50 future +0.6% after the cash market closed up 0.2% yesterday.

FX

• DXY recouped some of the prior day’s losses and reclaimed 113.00 status as yields slightly rebounded overnight although gains were limited amid the upbeat risk tone.
• EUR/USD gradually trickled to below the 0.9700 handle but still held on to most of its recent gains which was also helped by the recent hawkish ECB rhetoric.
• GBP/USD continued to pull back after hitting resistance around the 1.0900 level following yesterday's BoE action.
• USD/JPY traded higher and maintained 144 status as price action remained influenced by the yield differential dynamic.
• Antipodeans were on the back foot as the dollar slightly recovered, while the firm monthly Australian CPI data
• PBoC set USD/CNY mid-point at 7.1102 vs exp. 7.1066 (prev. 7.1107).

FIXED INCOME

• 10yr UST futures eased from this week’s highs as yesterday’s Gilt-driven rally faded and yields clawed back some of the losses after suffering the largest fall since 2009 owing to the BoE’s intervention and strong 7yr auction stateside.
• Bund futures remained firmer after the impact from the BoE’s policy pivot overshadowed the hawkish ECB rhetoric and with attention turning to upcoming German CPI data.
• 10yr JGB futures were kept afloat after gains in global counterparts but with upside capped amid mixed results at the 2yr JGB auction.

COMMODITIES

• Crude was rangebound and took a breather after surging yesterday on the back of the risk appetite, softer dollar pressure and bullish EIA inventory data.
• US senior military official said the jury is still out on whether Nord Stream pipeline ruptures were sabotage and said the US was "absolutely" not involved with the pipeline ruptures, according to Reuters.
• Russia's FSB security service is investigating damage to Nord Stream pipelines as international terrorism, according to Interfax citing the prosecutor's office.
• 157.7k barrels of oil (prev. 190.4k on Tuesday) and 184mln cubic feet of gas (prev. 184mln) were shut in on Wednesday in the Gulf of Mexico by Hurricane Ian, while a total of 16 oil and gas production platforms/rigs were evacuated, according to the offshore regulator.
• RBC sees a 'significant chance' of substantial OPEC+ supply cut and said OPEC+ may cut by 500k-1mln bpd at the October 5th meeting.
• Spot gold slightly eased overnight with price action at the whim of the dollar.
• Copper was steady and held on to most of the prior day's risk-driven gains.

GEOPOLITICS

RUSSIA-UKRAINE

• White House said the US will be prepared if Russia moves forward with annexation and that the consequences will be real and extraordinary, while the US State Department said can expect additional measures in the coming days in response to Russia's referendums on Ukrainian territory, according to Reuters.
• The EU is looking to ban imports of several steel products from Russia alongside prohibiting the export of some semiconductors, according to Politico citing proposals; highlights that diamonds are not mentioned.
• Turkish President Erdogan said that he plans to speak with Russian President Putin on Thursday, according to Anadolu Agency.
• Finnish interior minister said Finland will consider building a fence on its border with Russia, according to Bloomberg.

OTHER

• Japanese Chief Cabinet Secretary Matsuno said North Korea's multiple missile launches are unacceptable and Japan will maintain close contact with allies including the US to monitor and deal with North Korea, according to Reuters.
• US Army Central Command said it downed an Iranian drone on Wednesday while it was on its way to Iraq's Erbil as it was a threat to American forces in the region, according to a statement.
• Turkish President Erdogan said Turkey will increase its military presence in northern Cyprus, according to Sky News Arabia.

CRYPTO

• Bitcoin notched mild gains amid the constructive mood with prices back above the 19,500 level.

ASIA

NOTABLE APAC HEADLINES

• PBoC injected CNY 105bln via 7-day reverse repos with the rate kept at 2.00% and injects CNY 77bln via 14-day reverse repos with the rate kept at 2.15% for a CNY 180bln net injection.
• Chinese President Xi told Japanese PM Kishida that they attach great importance to the development of China-Japan relations and he is willing to work with Kishida to build relations, while Kishida told Xi that bilateral relations are currently facing many issues and challenges but he hopes to build constructive and stable relations to boost peace and prosperity, in messages to mark 50 years of diplomatic relations.

DATA RECAP

• Australian Monthly CPI YY (Aug) 6.8% (Prev. 7.0%)
• New Zealand ANZ Business Outlook (Sep) -36.7% (Prev. -47.8%)
• New Zealand ANZ Own Activity (Sep) -1.8% (Prev. -4.0%)

EU/UK

NOTABLE HEADLINES

• US President Biden's administration was reportedly alarmed by the market turmoil caused by the UK's economic program and is seeking ways to encourage PM Truss's team to dial back its tax cuts, according to Bloomberg.
• German economic research institute is expected to announce on Thursday that lacklustre consumer sentiment will tip Germany into a recession, while forecasts are expected to show GDP at -0.2% in Q3, -0.6% in Q4, and -0.4% in Q1 '23 before returning thereafter to modest growth, according to Reuters sources.
• ECB's Kazaks backs a 75bps hike at the October meeting and smaller steps after that.