• Equities in Europe are mostly lower despite initial positive performance; US futures bid, but shy of best.
• European earnings include ASML & Nestle; NFLX +13% in pre-market following their after-hours update
• Franc flounders as Dollar rebounds alongside bear-steepening in US Treasuries, USD/CHF probes parity as DXY tops 112.500.
• Gilts dented post-CPI which topped 10%, though clawed back losses to mid-97.00; broader complex pressured, though similarly off worst.
• WTI and Brent Dec futures are firmer intraday after yesterday’s decline, which saw Brent dip under USD 90/bbl  but settle at the figure.
• Looking ahead, highlights include Canadian CPI. Speeches from Fed's Bullard, Evans & Kashkari; BoE's Cunliffe & Mann; ECB's Centeno & Visco. Supply from the US. Earnings from Tesla, P&G, Abbott

As of 11:00BST/06:00ET

LOOKING AHEAD

• Canadian CPI. Speeches from Fed's Bullard, Evans & Kashkari; BoE's Cunliffe & Mann; ECB's Centeno & Visco. Supply from the US. Earnings from Tesla, P&G, Abbott.
• Click here for the Week Ahead preview.

EUROPEAN TRADE

EQUITIES

• Equities in Europe trade mostly lower after initially opening modestly firmer across the board.
• Sectors overall are now mostly lower (vs a mixed open) with no overarching theme, with Tech, Banks, Media, and Insurance towards the top of the bunch whilst Real Estate, Utilities, Retail, and Basic Resources sit as the laggards.
• US equity futures are off best levels with the RTY lagging peers and the NQ slightly more cushioned following Netflix earnings
• Click here and here for the Daily European Equity and Additional Opening News, which includes earnings from ASML & Nestle among others.
• Netflix Inc (NFLX) - Q3 2022 (USD): EPS 3.10 (exp. 2.13), Revenue 7.93bln (exp. 7.84bln). Q3 Net subscriber additions 2.41mln (exp. 1.07mln). Sees Q4 EPS USD 0.36 (exp. 1.20). Sees Q4 revenue USD 7.78bln (exp. 7.98bln). Sees Q4 streaming paid net change +4.5mln (exp. +3.9mln). Won't provide paid membership forecasts from Q4. (PR Newswire) Shares rose 14.3% after-market, +13.8% in the pre-market
• Click here for more detail.

FX

• Franc flounders as Dollar rebounds alongside bear-steepening in US Treasuries, USD/CHF probes parity as DXY tops 112.500.
• Sterling deflated irrespective of firmer than forecast UK inflation data on broader economic, fiscal and political concerns; Cable tests support around 1.1250 from a 1.1350+ peak.
• Euro fades against Greenback and edges closer to 0.9800, Yen slips further through 149.00 in the ongoing absence of actual Japanese intervention and the Loonie treads cautiously between 1.3700-1.3800 parameters into Canadian CPI.
• Antipodes fare better vs their US peer post-NZ inflation and pre-Aussie jobs as NZD/USD hovers near 0.5700 and AUD/USD just above 0.6300.
• Japanese PM Kishida says no comment on FX; need to take appropriate action against excess FX volatility. Japan's Finance Minister Suzuki says there is no change to the thinking on FX, in frequent communication with the MOF.
• Click here for more detail.

FIXED INCOME

• Gilts dented post-CPI which topped 10%, though clawed back losses to mid-97.00; before further pressure on political updates and ahead of a later DMO outing.
• Bunds and USTs under pressure in sympathy, with Bunds tacking the laggard mantel in wake the German FinMin increasing the size of outstanding bonds; yield above 2.30%
• Stateside, USTs are moving in tandem with peers though magnitudes a touch more contained ahead of 20yr supply and Fed speak; curve mixed, overall.
• German Finance Ministry says increased the size of 18 outstanding bonds by EUR 3bln each (total of EUR 54bln), via Reuters; increase will provide flexibility to cover financing needs during the energy crisis.
• Click here for more detail.

COMMODITIES

• WTI and Brent Dec futures are firmer intraday after yesterday’s decline, which saw Brent dip under USD 90/bbl but settle at the figure.
• Spot gold trades lower intraday and back under the USD 1,650/oz mark as the Dollar picks up in pace.
• LME metals are mostly softer amid the firmer Dollar and risk aversion, with 3M copper extending its losses under USD 7,500/t.
• US Private Energy Inventory (bbls): Crude -1.3mln (exp. +1.4mln), Gasoline -2.2mln (exp. -1.1mln), Distillates -1.1mln (exp. -2.2mln), Cushing +0.9mln.
• US President Biden will lay out plans on Wednesday to continue using the SPR to gain more stability in gas prices and will reiterate that gasoline company profits are too high and should be returned to consumers, according to a senior administration official. Furthermore, the Biden administration agreed to make future oil purchases to refill reserves at prices at or below USD 67.00-72.00/bbl, while President Biden will announce 15mln additional barrels for delivery from SPR in December, extending the initial timeline and completing the 180mln commitment.
• Click here for more detail.

NOTABLE EUROPEAN HEADLINES

• Daily Mail's Hodges understands UK PM Truss has been informed by Graham Brady the traditional threshold of letters for a leadership challenge has been breached. But he is insisting on a threshold of half the parliamentary party before acting.
• UK Tory rebels were reported to have asked opposition Labour Party MPs to help them oust UK PM Truss as Tory backbenchers grow increasingly frustrated with the PMs leadership, according to The Telegraph.
• Pensions could increase in line with earnings instead of inflation next year after UK PM Truss went back on her commitment to the pension triple lock, according to The Telegraph.
• UK Chancellor Hunt met with Chairman of the 1922 Committee Brady on Tuesday afternoon which prompted further questions about the future of UK PM Truss, according to Sky News.
• UK Chancellor is lining up taxes on energy companies and banks to fill a GBP 40bln UK fiscal hole, according to FT.
• Germany is planning an electricity price cap along the lines of a gas cap, according to Handelsblatt; German Economy Ministry Draft: cabinet should discuss power and gas price breaks on November 18th, via Reuters.

NOTABLE EUROPEAN DATA

• UK CPI YY (Sep) 10.1% vs. Exp. 10.0% (Prev. 9.9%); MM (Sep) 0.5% vs. Exp. 0.4% (Prev. 0.5%)
• UK Core CPI YY (Sep) 6.5% vs. Exp. 6.4% (Prev. 6.3%); MM (Sep) 0.6% vs. Exp. 0.5% (Prev. 0.8%)
• EU HICP Final YY (Sep) 9.9% vs. Exp. 10.0% (Prev. 10.0%); X-&E Final YY (Sep) 6.0% vs. Exp. 6.1% (Prev. 6.1%)

NOTABLE US HEADLINES

• Fed's Kashkari (2023 voter) said the Fed won't need to do as much with interest rates if they can get help from the supply side but without help from the supply side, the Fed would need to do more. Kashkari added that core inflation has not shown evidence of a peak and he is not ready to declare a pause in rate hikes until he sees some compelling evidence that core inflation has at least peaked although would be comfortable pausing once he has confidence inflation has peaked. Furthermore, Kashkari said he could easily see rates getting to mid-4% next year and if he doesn't see progress on inflation, he doesn't see why rates should not go higher.

CRYPTO

• Japan plans to further loosen crypto rules as soon as December "by making it easier to list virtual coins, potentially boosting the country’s allure for Binance and rival exchanges", according to Bloomberg.

GEOPOLITICS

RUSSIA-UKRAINE

• Russia says it is preparing to evacuate civilians from Kherson which comes as Ukrainian troops push closer to the city as part of a successful counter-offensive, according to AFP News Agency
• Europe is planning to sanction a number of Iranian individuals and entities regarding arms sales to Russia, according to Politico citing diplomats/officials; adding, a list of sanctions has been prepared, aim is to be in agreement before Thursday/Friday
• US, Britain and France plan to raise Iran's arms transfers to Russia during closed-door UN security council meeting Wednesday, according to Reuters citing diplomats.

OTHER

• North Korea said it fired artillery shells on Tuesday to send a warning against South Korea's military drills and it called on its 'enemies' to immediately stop causing military tensions, according to KCNA.

APAC TRADE

EQUITIES

• APAC stocks were mixed following the choppy performance stateside where the major indices wobbled on news that Apple cut iPhone 14 Plus production less than two weeks after its debut, but then recovered heading into the close and with futures underpinned after-hours after strong earnings and subscriber additions from Netflix.
• ASX 200 gained with outperformance in defensive sectors although the upside was contained by a lacklustre mood in miners after BHP’s quarterly output update which included higher iron output but also a severe drop in coal production.
• Nikkei 225 was led higher by notable strength in blue-chip names including SoftBank and Fast Retailing and with firm gains also in utilities and power stocks, while the latest commentary from BoJ board member Adachi echoed the central bank’s dovish message as he warned against a shift towards tightening and pushed back on responding to short-term FX moves with monetary policy.
• Hang Seng and Shanghai Comp. remained pressured amid COVID concerns and data uncertainty, while Hong Kong Chief Executive John Lee’s first annual Policy Address failed to inspire a turnaround despite the announcement of measures to support property, tech start-ups and attract foreign talent.

NOTABLE APAC HEADLINES

• Hong Kong Chief Executive John Lee said in his first annual Policy Address that national sovereignty and security are top priorities, while he also noted Hong Kong faces a “new chapter” of development and warned Hong Kong faces risks from global turmoil and Covid. Lee added that they will allow overseas talent to refund extra stamp duty on home purchases and will introduce a bill this year to exempt the stamp duty payable for transactions conducted by dual-counter market makers. Lee also stated the HKEX will revise main board listing rules next year to facilitate fundraising of advanced tech enterprises that have yet to meet the profit and trading record requirements, according to Reuters.
• BoJ's Adachi said monetary policy does not directly control FX and there are times FX moves rapidly short-term, while he added that responding to short-term FX moves with monetary policy would heighten uncertainty over BoJ's guidance which is not good for the economy. Adachi also stated that inflation is starting to increase but he is not convinced yet that the BoJ's target will be achieved in a stable and sustained manner. Furthermore, he said they must be cautious about shifting toward monetary tightening as downside risks to the economy are increasing and a shift to monetary tightening would weaken demand and heighten the risk Japan will revert to deflation, while the best approach now is to maintain easy monetary policy.