• Equities are in the red as a blockbuster docket of earnings dominates price action
• Within Europe, Autos & Banking names lag after results from Volvo Cars, Mercedes-Benz, Volkswagen, Standard Chartered, BNP Paribas & many more
• Stateside, Meta slips pre-market with desks citing a cautious/conservative outlook
• DXY in the green while JPY eclipses 150.50 before a brief but sharp pullback, core debt benchmarks near unchanged pre-ECB
• Crude contained while XAU benefits from geopolitical rhetoric from Israel and Iran regarding Gaza
• Looking ahead, highlights include US GDP, PCE Prices Advance, IJC, ECB & CBRT Policy Announcements, ECB's Lagarde & BoE's Cunliffe, Supply from the US. Earnings: Valero, Comcast, UPS, Southwest, Mastercard, Merck & more.

EUROPEAN TRADE

EQUITIES

• European bourses are in the red, Euro Stoxx 50 -0.8%, with a blockbuster docket of earnings dominating action and the overall tone hampered by the soft Wall St. handover and subsequent pressure in Meta, -2.5% pre-market; from a macro perspective, the ECB looms.
• Sectors feature marked Autos/Parts pressure after Volvo Car (-9.2%), Mercedes-Benz (-5.5%) & Volkswagen (-1.0%) updates; Banking names pressured post-Standard Chartered (-10.2%) & BNP Paribas (-4.0%); more broadly, Utilities have been experiencing some modest relative outperformance, perhaps owing to their defensive nature in the absence of updates from the sectors heavyweights.
• Stateside, futures reside in the red ES -0.5% with the focus firmly on mega-cap corporates and the NQ -0.8% continuing to languish given the poor-reception to the Meta call; ahead, AMZN & INTC are the after-hours highlights.
• Click here and here for the sessions European pre-market equity newsflow, including earnings.
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FX

• Dollar continues its resurgence with DXY extending towards 107.00 within a 106.520-880 range.
• Yen loses the battle to defend 150.00 and stealthily arrests slide after hitting a sub-150.50 low; note, at 07:50BST USD/JPY moved sharply lower after advancing to a high of 150.77. Pulled back to 149.80 before trimming downside and moving back to circa 150.40.
• Euro straddles 1.0550 amidst spread of decent option expiry interest ahead of ECB.
• Franc and Sterling lose more ground vs Greenback before finding support circa 0.9000 and 1.2070 respectively.
• Aussie undermined by not so hawkish RBA Bullock response to hot CPI data, as AUD/USD pivots 0.6300 and AUD/NZD cross sits under 1.0900.
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• Click here for the Option Expires for the NY Cut.

FIXED INCOME

• Debt futures regain a degree of composure in contrast to equities ahead of key risk events.
• Bunds, Gilts and T-note all back just into positive territory within 128.18-127.56, 92.35-91.62 and 105-24+/15+ respective ranges pre-US GDP, IJC, durable goods and ECB.
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COMMODITIES

• Crude benchmarks are modestly softer on the session but once again newsflow is relatively limited in nature ex-geopols; as such the December'23 contracts remain within familiar levels around 30-40 cents below the USD 85.00/bbl and USD 90.00/bbl marks for WTI and Brent respectively.
• Main development has been rhetoric from Israel and Iran regarding the expected ground invasion of Gaza by Israel after the PM confirmed it would happen; in response, the Iranian IRGC warned Israel against such an operation.
• Spot gold is firmer to the tune of USD 10/oz and is testing the USD 1990/oz mark to the upside with the focus on geopols; levels above largely coalesce around the USD 2050/oz figure before the YTD peak of USD 2081/oz.
• Base metals are in the red as they are tracking the broader market tone and the accompanying underlying USD bid; though, the pace of the decline has slowed significantly in recent trade alongside a slowdown in macro developments and a steadying in broader price action ahead of a packed PM agenda.
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NOTABLE HEADLINES

• Citi/YouGov Inflation Expectation Survey (Sep): Short-term expectations 4.2% (prev. 4.4% in August); 5-10yr ahead remains at 3.3%, according to Reuters.
• Riksbank says it has decided to offer central counterparties that clear SEK and are participants in the RIX-RTGS system the opportunity to borrow money overnight from the Riksbank.

NOTABLE HEADLINES

• Meta Platforms Inc (META) Q3 2023 (USD): EPS 4.39 (exp. 3.63), Revenue 34.15bln (exp. 33.56bln); Q4 revenue view 36.5-40bln (exp. 38.76bln). Operating margin 40% (exp. 33.9%). REVENUE BREAKDOWN: Advertising 33.64bln (exp. 32.94bln). Family of Apps 33.94bln (exp. 33.08bln). Reality Labs 210mln (exp. 313.4mln). Other 293mln (exp. 212.7mln). Click here for the full earnings. Shares -3.4% after market - participants cited a cautious/conservative outlook.
• International Business Machines Corp (IBM) Q3 2023 (USD): EPS 2.20 (exp. 2.13), Revenue 14.75bln (exp. 14.73bln); still sees FY revenue at constant FX +3-5% (exp. +3.01%) Adj. gross margin 55.5% (exp. 54.9%). FCF 1.68bln (exp. 1.35bln). REVENUE BREAKDOWN: Software 6.27bln (exp. 6.26bln). Consulting 4.96bln (exp. 5.1bln). Infrastructure 3.27bln (exp. 3.15bln). Financing 186mln (exp. 186mln).Shares +1.4% after market.
• UAW confirms they have a tentative agreement with Ford (F), and said strikers should go back to work while voting for a deal. UAW's deal with Ford includes a 25% wage increase. Ford workers will receive an 11% immediate wage hike, according to Reuters.
• Morgan Stanley (MS) announces Ted Pick to become Chief Executive Officer on January 1, 2024; James Gorman to become Executive Chairman. Incoming CEO Ted Pick says this is a 'volatile environment' for investment banking, according to Reuters.
• Biden Admin is reportedly seeking USD 3.1bln to reimburse telecom firms for removal of additional Huawei and ZTE equipment from US networks, according to Reuters.
• US Republican Senators group has introduce a stand-alone bill to send aid to Israel but not to Ukraine, via WSJ.

GEOPOLITICS

ISRAEL-HAMAS

• "IDF carried out an unusual and extensive ground raid by infantry and armored forces inside the Gaza Strip", according to Israeli press citing Army Radio; "According to the report, the raid took place on a larger scale and deeper inside Gaza" "The objective of the raid was to attack Hamas targets from the Gaza Strip and strengthen the defense." "The defense establishment says that this is a more extensive operation than the raids carried out so far in the past two weeks inside the Gaza Strip." Thereafter, the Israeli Army said soldiers have since exited Gaza, according to Bloomberg.
• The Israeli army announced the downing of a surface-to-air missile launched from Lebanon, according to Sky News Arabia.
• Hamas fighters reportedly trained in Iran before the October 7th attacks, according to WSJ citing sources; roughly 500 Hamas and Palestinian militants received specialized combat training. Sources add they have no information suggesting the training was Intended for October 7th.
• The Iranian Foreign Minister arrived in New York for international talks after the intensification of the crisis in Gaza, according to Al Jazeera citing Iranian press IRNA.
• Iranian IRGC Commander warns Israel against commencing a ground operation within Gaza, saying "“the dragon of Gaza will devour them. If they set foot in Gaza, they’ll be buried there.".

OTHER

• US President Biden is expected to speak with Chinese Top Diplomat Wang Yi on Friday at the White House, according to Reuters sources.
• Russian Defence Minister Shoigu said "we are to start training on nuclear strike", according to Reuters.
• An explosion was heard near a US base in the suburbs of al-Hasakah in north-eastern Syria, according to Iran International citing Syrian press.

CRYPTO

• Bitcoin is modestly in the red but retains the bulk of the last few sessions upside which saw it convincingly eclipse the USD 35k mark; as it stands, BTC is holding around the USD 34.5k figure within relatively narrow bounds.

APAC TRADE

• APAC stocks traded lower across the board, following the weak lead from Wall Street as participants juggle earnings, geopolitics, and data as major central banks line up for their next confabs, with the ECB due today, while the BoJ, FOMC, and BoE are slated for next week.
• ASX 200 was dragged lower by its Tech sector, mirroring a similar sectoral performance seen stateside. Energy, however, was among the better performers.
• Nikkei 225 also saw its losses led by the Tech sector, whilst the losses in the JPY vs the USD failed to cushion the downside for the index.
• KOSPI saw its chip sector languish, facing added headwinds as SK Hynix slumped over 4% post-earnings.
• Hang Seng and Shanghai Comp opened lower, but their losses were shallower than those of their regional peers, potentially amid stimulus optimism, while reports, before the Chinese market opened, suggested that US President Biden was expected to meet with Chinese Top Diplomat Wang Yi on Friday at the White House.
• US equity futures softened across the board, with the NQ (-1.1%) lagging after Meta shares initially rose almost 5% following earnings but later fell into losses of over 3% during the earnings call.

NOTABLE ASIA-PAC HEADLINES

• RBA Governor Bullock said CPI was a little higher than expected but was about where we thought it would come. She added that goods prices coming down, but services inflation remains persistent, but she's still considering whether CPI was a "material" change to outlook. Bullock said services inflation is higher than what the RBA is comfortable with and will have to build this into forecasts. She said she would not like to say if CPI makes the rate rise more likely, and said there will be a change to the inflation forecast, but she's not sure if it will be material. Bullock said the RBA is wary of inflation and has made it clear that the RBA might have to hike again but has not yet decided whether a rise is needed, according to Reuters.
• Westpac economists change their call on RBA, and now see a rate rise in November, according to Reuters.
• Japan Finance Minister Suzuki said closely watching FX moves with a high sense of urgency, according to Reuters. Suzuki added they stick to previous currency policy, closely watching FX moves.
• Japanese PM Kishida said BoJ's monetary policy aims to achieve sustainable inflation in tandem with wage hikes and does not contradict the government's inflation countermeasures, according to Reuters. Japanese PM Kishida says BoJ holds ETFs and JGBs as part of its monetary policy.
• PBoC injected CNY 424bln via 7-day reverse repos with the rate at 1.80% for a CNY 80bln net daily injection.
• PBoC set USD/CNY mid-point at 7.1784 vs exp. 7.3265 (prev. 7.1785)
• SK Hynix (000660 KS) - Q3 (KRW) Revenue at 9.1tln (exp. 8.17tln). Operating loss 1.8tln (exp. loss 1.7tln). Net loss 2.2tln (exp. loss 1.5tln); Sees about 10% rise in Q4 DRAM shipments vs Q3 due to the rise in sales. Q3 DRAM average selling price is up about 10% vs Q2. Q3 NAND average selling price is down slightly vs Q2. 2024 CAPEX to be higher than 2023, but to keep the hike to a minimum. Plans a fall of teens % in Q4 NAND shipments vs Q3, aiming to cut low-profit sales. Semiconductor prices are starting to stabilize.
• Chinese Commerce Ministry says consumption recovery has become more obvious since Q3.

DATA RECAP

• South Korean BOK Manufacturing BSI (Nov) 71.0 (Prev. 69.0)
• South Korean GDP Growth QQ Advance (Q3) 0.6% (Prev. 0.6%); YY Advance (Q3) 1.4% (Prev. 0.9%)
• Japanese Foreign Investment Japanese Stock w/e 214.7B (Prev. 1259.9B, Rev. 1263.9B); Bond Investment w/e -151.7B (Prev. 794.0B, Rev. 808.1B)
• Australian Import Prices (Q3) 0.8% (Prev. -0.8%); Export Prices (Q3) -3.1% (Prev. -8.5%)