• European bourses are posting mild gains, Euro Stoxx 50 +0.2%, with participants awaiting the conclusion of the Biden-Xi meeting.
• Stateside, futures are pressured as the recent rally seemingly runs out of steam and also following Fed's Waller pushing back on the post-CPI reaction, ES -0.4%.
• DXY has surpassed the 107.00 mark to the detriment of the traditional havens while the Yuan continues to draw focus.
• A concerted bid has recently been seen in EGBs, perhaps post-Panetta; however, USTs remain softer and attentive to remarks from Waller
• Commodities have been slipping throughout the session, amid the USD's relative resurgence and following renewed COVID controls in Beijing
• Looking ahead, highlights include a speech from ECB's de Guindos, BoC's Macklem, Fed's Williams & a BoE Short-term gilt sale.
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EUROPEAN TRADE

EQUITIES

• European bourses are posting mild gains, Euro Stoxx 50 +0.2%, with participants awaiting the conclusion of the Biden-Xi meeting.
• Sectors were predominantly in the green, though performance has turned more mixed as the session progresses.
• Stateside, futures are pressured as the recent rally seemingly runs out of steam and also following Fed's Waller pushing back on the post-CPI reaction, ES -0.4%.
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FX

• DXY spent much of the morning attempting to reclaim the 107.00 mark, with peers deriving modest upside as such though this was mixed with EUR and GBP a touch softer, for instance.
• However, the index has since surpassed the 107.00 handle and lifted to a 107.19 peak to the detriment of peers across the board, though EUR and GBP haven't slipped much further and reside around 1.03 and 1.1750 respectively.
• Traditional havens CHF and JPY are the current laggards, with the JPY particularly impaired and USD/JPY above 140.50 as such and was perhaps spurred by Governor Kuroda reminding that they are to continue with monetary easing.
• Yuan drew much of the focus overnight after the PBoC set its strongest fix since late-September and amid two-way newsflow for the region regarding property support and COVID controls; CNY concluded the domestic session at 7.0378.
• PBoC set USD/CNY mid-point at 7.0899 vs exp. 7.0896 (prev. 7.1907); strongest fix since Sep 27th
• RBI Governor Das said India has a major challenge with regard to inflation. He added that the RBI's FX interventions are impacted by day-to-day developments, and the objective is to prevent excessive volatility. Das added that the RBI's reserves are very comfortable, via Reuters.
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Notable FX Expiries, NY Cut:

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FIXED INCOME

• Core benchmarks were relatively rangebound in the European morning, with the benchmarks struggling to derive any lasting traction from brief forays some 30/40 ticks either side of the unchanged mark.
• However, a concerted bid has been seen most recently in EGBs and Gilts; perhaps spurred by ECB's Panetta who placed emphasis on the risk of policy errors.
• Stateside, USTs are a touch softer and are playing catchup to the Veteran’s Day holiday on Friday and also conscious of remarks from Fed’s Waller who has pushed-back on the post-CPI pricing.
• As such, USTs are lower by a handful of ticks towards the mid-point of 111.27+ to 112.06+ parameters with yields elevated though the 10yr is sub-4.00% and significantly shy of last week’s 4.24% peak.
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COMMODITIES

• Crude benchmarks have been slipping throughout the European morning as initial upside on the USD’s pullback dissipated with the DXY now back above 107.00.
• Benchmarks are near session lows on the above action and also amid a further strengthening of COVID measures within Beijing after the city reports the highest number of cases in a year.
• US Treasury Secretary Yellen said India can buy Russian oil at any price if it does not use Western insurance or maritime services, according to a Reuters interview, and said the existence of a G7 oil price cap will give India and other developing countries leverage in bargaining with Russia on oil. Yellen said they are happy for India, China, and Africa to get a "bargain" on Russian oil, inside or outside the price cap. An Indian government official said they do not believe India will follow the price cap mechanism and have communicated that to the countries.
• OPEC+ "may discuss adjustments to members' oil production baselines in early December as many of them struggle to meet their agreed quotas", according to Energy Intel. "Delegates said it is too early to predict what might happen in Vienna in terms of any potential changes to the alliance's production policy or baseline adjustments. "
• Iraq's Prime Minister said Iraq is keen to commit to OPEC policies and decisions but the OPEC production quota should be reconsidered by OPEC members. Iraqi PM added that Iraq needs to raise its oil production to generate more revenues and is keen to maintain stable oil prices of "not above USD 100/bbl". Iraq said it will have a discussion with OPEC members to increase its production quota, via Reuters.
• ExxonMobil (XOM) announced the first LNG cargo from the Coral South FLNG project in Mozambique, the floating production vessel is expected to produce up to 3.4mln metric tons of LNG per annum, via Reuters.
• JPMorgan expects Brent to re-test USD 100/bbl in Q4-2022 and average USD 98/bbl in 2023, via Reuters.
• Earthquake magnitude 6.4 hit around 20km North-west of Lebu, Chile, according to EMSC.
• Both precious and base metals have succumbed to the USD’s relative resurgence with additional headwinds from the mentioned COVID controls. Specifically, spot gold has slipped back towards the USD 1750/oz mark.
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CRYPTO

• FTX was subject to a hack with "mysterious" outflows totalling over USD 600mln, according to CoinDesk. FTX said it has been hacked and instructed users not to install new updates and to delete all FTX apps.
• FTX CEO John Ray said unauthorised access to certain assets has occurred. FTX is in the process of removing trading and withdrawal function to a new cold wallet custodian, via Reuters.
• Hedge fund Galois Capital said that close to half of its capital is stuck on the FTX Exchange, according to FT.
• Hong Kong's AAX Exchange is suspending withdrawals for up to 10 days, as the failure of FTX reverberates through crypto markets, according to CoinDesk.
• Crypto lender BlockFi has paused withdrawals and limited platform activity amid FTX collapse, according to Bloomberg
• Crypto Exchange Huobi says it will continue to take all appropriate steps to withdraw crypto assets from FTX as soon as possible; the incident does not currently affect normal business operations of the group, according to Reuters.
• Visa (V) has terminated its global debit card agreement with FTX, according to a Visa spokesperson via Reuters.
• Binance CEO, on crypto exchanges, said there are still quite a lot of players that cut corners, via Reuters. Subsequently, says they are forming an industry recovery fund, to assist projects which are otherwise strong but are in a liquidity crisis.

NOTABLE EUROPEAN HEADLINES

• UK Chancellor Hunt said he will set out a long-term plan for energy, and said we do have to increase taxes and cut spending. He said he wants to make sure a recession is as short and shallow as possible if the UK falls into one. He added that he will be talking about constraints on the labour force in the budget plan, via Reuters.
• UK Chancellor Hunt said the OBR forecasts will likely present a similar picture to recent BoE forecasts of a recession. Hunt plans to commit around GBP 20bln to extend the energy price guarantee scheme by six months from April and is eyeing a multi-billion-pound package to shield pensioners and benefit claimants from the increases in power bills, according to The Times.
• UK Treasury discussing raising energy price cap from April; department considers making policy announcement in the autumn statement rather than waiting until spring, according to Guardian sources. It is understood that continuing some universal level of support, possibly in the form of a higher energy cap, is also on the table.
• Germany's IG Metall union has called for further strike action on Monday. Strikes will take place at targeted locations in the states of Hesse, Thuringia and Rhineland-Palatinate, according to the union cited by Reuters.
• ECB's Panetta says monetary policy needs to tighten so that inflation does not become entrenched, the consequences of possible errors may not be perceptible today, but they would become evident over time. It may then be too late to fully reverse them.

NOTABLE EUROPEAN DATA

• UK Rightmove House Price Index MM (Jun) -1.1% (Prev. +0.9%); Y/Y 7.2% (Prev. 7.8%).
• EU Industrial Production MM (Sep) 0.9% vs. Exp. 0.3% (Prev. 1.5%, Rev. 2.0%); YY (Sep) 4.9% vs. Exp. 2.8% (Prev. 2.5%, Rev. 2.8%)

NOTABLE US HEADLINE

• Fed's Waller (Voter) said the recent CPI report is "just one data point and markets are "way out in front". Waller added that they will need to see a run of CPI reports to take the foot off the brake. He said 7.7% CPI inflation is "enormous" and the Fed still has a long way to go, rates will stay longer for a while. He said rate hikes so far have not broken anything, and he looks at potentially hiking 50bps at the next meeting or after. He noted that the US housing market will be okay and the household balance sheet remains in good shape. Waller said there was always going to be a communications challenge to signal the slowdown in the pace of hikes and the Fed is "not softening". Waller added that the signal was to pay attention to the endpoint, not the pace of rate increases, and until inflation slows, that endpoint is "a way out", via Reuters.
• US Treasury Secretary Yellen said it would be irresponsible not to raise the US debt ceiling, according to a Reuters interview.
• US House Speaker Pelosi said it would be important to have either a permanent or a very large extension of the debt limit during the remainder of the congressional session, according to an ABC Interview. Pelosi said he has no plans to step away from Congress.
• Goldman Sachs sees a significant decline in inflation in 2023, sees US core PCE measure falling to 2.9% from 5.1% currently by December 2023, via Reuters.
• Disney (DIS) is reportedly planning a targeted hiring freeze and job cuts, according to CNBC.
• Click here for the US Early Morning note.

US MID-TERM ELECTIONS

• Democrats will retain control of the Senate as NBC News projects that Catherine Cortez Masto wins the Nevada Senate race.
• Democratic incumbent Mark Kelly defeated Republican Challenger Blake Masters in the race for the US Senate seat in Arizona, according to Edison Research.
• Edison Research projects Democrats win another seat in the US House, bringing the total to 206; 218 needed for control.

GEOPOLITICS

RUSSIA-UKRAINE

• Ukrainian Foreign Minister said Russian counterpart Lavrov has not asked for a meeting, according to Reuters.
• Ukrainian President Zelensky said Kyiv's forces have taken control of over 60 settlements in the Kherson region. He added that Ukrainian forces are holding firm as brutal battles take place every day in the Donetsk region, via Reuters.
• US President Biden and Russian Foreign Minister Lavrov arrived in Indonesia for the G20 Summit, according to Reuters.
• US Treasury Secretary Yellen said some Russian sanctions could be extended beyond the end of the war in Ukraine, according to WSJ.
• US Treasury Secretary Yellen said they will determine the price level for the Russian oil price cap in the coming weeks, via Reuters.

US-CHINA

• US President Biden says US and China can manage differences and stop competition from turning into conflict, expects US and China to play a role in address climate and food shortages.
• Chinese President Xi says has stayed in touch with US President Biden via video but it is no replacement for in-person meetings, both nations need to chart their course and find the right direction for the relationship and elevate it. Prepared to have a candid and in-depth exchange of views on the US-China relationship.
• The White House said further engagement after the Biden-Xi meeting could include face-to-face meetings, according to Reuters. Stated prior to the meeting
• US President Biden will make it clear in the meeting with Chinese President Xi that the US does not seek competition or conflict, and the meeting could last "a couple of hours", according to Reuters citing the White House National Security Adviser Sullivan. Stated prior to the meeting
• US President Biden underscored that freedom of navigation and overflight must be respected in the East China Sea and the South China Sea, via Reuters.
• US President Biden will raise the issue of North Korea with Chinese President Xi at the G20 Summit, according to the White House. Biden will tell Xi that if North Korea continues, there will be more enhanced US military presence in the region.
• Blackrock (BLK) has shelved its China bond ETF amid growing tensions between the US and China alongside a reversal in the China-US yield differential, according to FT.
• US Treasury Secretary Yellen will ask for clarity on China's plans to ease COVID restrictions alongside issues in the Chinese property market, in a meeting with the PBoC Governor, according to Treasury officials cited by Reuters.
• US Treasury Secretary Yellen said the US will likely discuss export controls with Chinese officials, according to Bloomberg.

OTHER

• US President Biden does not plan a sit-down meeting with Saudi Crown Prince Bin Salman during the G20 Summit, according to Reuters citing the White House National Security Adviser Sullivan.
• South Korean President Yoon hopes for trilateral talks with China and Japan, according to Yonhap. Yoon added that if North Korea conducts another intercontinental ballistic missile (ICBM) test or its 7th nuclear test, the international community should respond with one voice.
• South Korean President Yoon has called for a strengthening in extended deterrence in response to North Korea's growing nuclear threats, via Reuters.
• US President Biden said the US, Japan, and South Korea are more aligned than ever on North Korea. Biden said the US discussed with South Korea and Japan the strengthening of supply chains, via Reuters.
• White House National Security Adviser Sullivan said the US, Japan, and South Korea have a coordinated response if North Korea carries out its 7th nuclear test, via Reuters.
• Russian President Putin spoke to his Iranian counterpart and both leaders emphasised the need to intensify political, trade, and economic cooperation, according to a Kremlin statement.
• Russian and US delegations are holding talks within Turkey, via Reuters citing Kommersant
• Australian PM said he had a very positive and constructive conversation with China's Premier, and added that Australia has an alliance with the UK and the US, but should cooperate with China where possible, via Reuters.
• Japanese PM Kishida said China is stepping up actions that infringe on Japan's sovereignty, according to JiJi.
• Japanese PM Kishida said they are continuing to prepare a meeting with Chinese President Xi but no date has been set yet. Kishida said the US, China, and South Korea mainly discussed South Korea at its trilateral meeting and did not discuss other geopolitical issues such as Taiwan, via Reuters.
• Russian Foreign Minister Lavrov was in hospital for a checkup, has since left the hospital, via Bali governor. Note, the Russian Foreign Minister described this as fake news

APAC TRADE

EQUITIES

• APAC stocks eventually traded mostly lower despite the positive lead from Wall Street on Friday.
• ASX 200 was contained on either side of the flat mark with losses in Industrials, Telecoms and Healthcare offsetting the gains from the Metals, Mining, and Materials sectors.
• Nikkei 225 saw its losses lead by Softbank shares tumbling over 12% following its earnings on Friday, which saw the Co’s Vision Fund post a quarterly net loss.
• KOSPI eventually faded earlier gains following the trilateral meeting between the US, Japan, and South Korea over the weekend, in which White House National Security Adviser Sullivan said the US, Japan, and South Korea have a coordinated response if North Korea carries out its 7th nuclear test.
• Hang Seng and Shanghai Comp traded in the green for most of the session, with Hong Kong outperforming following source reports that the PBoC and China's Banking and Insurance Regulator told financial institutions to extend support for property firms, with the Hang Seng Property index surging over 15% in early trade, but traders remain cognizant of the Biden-Xi meeting poised to take place on Monday at 09:30GMT/04:30EST.

NOTABLE ASIA-PAC HEADLINES

• Beijing authorities stated on Monday to further strengthen COVID prevention and control measures and reminded residents not to go out unless necessary. The measures are seen as a response to the mounting pressure of soaring cases in the city, according to Global Times.
• China reported 1,794 new confirmed COVID cases in the Mainland on Nov 13th (vs 1,711 on Nov 12).
• Beijing reported the highest number of local COVID cases in over a year, reporting 404 cases on Sunday, according to Bloomberg.
• The PBoC and China's Banking and Insurance Regulator told financial institutions to extend support for property firms, according to Reuters sources. Bloomberg reported that China's real estate rescue package consists of a 16-point playbook for finance officials across the country, according to sources.
• China's Securities Journal noted that China is expected to inject liquidity via a new MFL (unverified).
• PBoC injected CNY 5bln via 7-day reverse repos with the rate at 2.00% for a CNY 3bln net drain.
• PBoC issues a notice to further support the extension of loan repayments for small firms.
• BoJ Governor Kuroda said the Japanese economy is picking up; now is the stage to continue monetary easing to support the economy, according to Reuters. Kuroda said they are closely watching the impact of raw material inflation and currency moves on firms and households. Kuroda said the BoJ and the government are closely monitoring the impact of FX, and market moves on the economy and prices; and said abnormally one-sided sharp JPY weakening appears to have paused, partly thanks to the government's FX intervention.
• Earthquake shakes buildings in Tokyo, Japan, via Reuters; prelim. magnitude of 6.1 via NIED. Magnitude 5.6 earthquake near the S. Coast of Honshu, Japan, via EMSC