• European bourses slump, whilst US futures meander on either side of the unchanged level; NQ underperforms on higher yields
• Bonds continue to sell-off following yesterday’s hawkish leaning comments from Fed Chair Powell and a dismal US long bond auction
• DXY is slightly lower, edging towards session lows of 105.76 with G10’s generally lifeless against the Dollar
• Crude benchmarks extend gains and entirely pare back the losses seen late in yesterday's session, whilst base metals are hit by broader negative risk tone
• Looking ahead, Highlights include US UoM, Chinese M2 Money Supply, BoC SLOOS, Fed’s Logan, Bostic, Daly; ECB’s Lagarde

EUROPEAN TRADE

EQUITIES

• European bourses reside in the red, Euro Stoxx 50 -0.8%, though the region is on track to end the week around the unchanged mark overall. Action which comes as a continuation of the post-Powell/auction hit to sentiment experienced in Thursday's US session.
• Sectors are primarily softer with Food, Beverage & Tobacco hit as Diageo cuts guidance, Consumer Products/Services sold post-Richemont while Real Estate slips on SBB and Redrow. Energy bucks the trend and is modestly firmer as benchmarks attempt to once again recoup from recent pressure.
• Stateside, futures are near the unchanged mark within -0.2% to +0.2% parameters with the ES flat and the NQ lagging a touch as US yields inch higher. Ahead, a handful of Fed speakers will be scrutinised for any deviation from the Powell line.
• Click here and here for the sessions European pre-market equity newsflow, including earnings.
• Click here for more details.

FX

• Buck back on a recovery track as Fed Chair Powell underscores lack of confidence about current policy being restrictive enough, DXY edges closer to 106.00 from sub-105.00 w-t-d low.
• Euro and Yen defend semi-psychological 1.0650 and 151.50 marks vs Dollar, Pound keeps afloat of 1.2200 against Greenback post-better than forecast UK GDP metrics.
• Franc pares losses towards 0.9000 as SNB Schlegel highlights the prospect of a blip in inflation on rents, Norwegian Krona rejuvenated by hotter than consensus CPI, core especially.
• PBoC sets USD/CNY mid-point at 7.1771 vs exp. 7. 2963 (prev. 7.1772)
• Click here for more details.
• Click here for the Option Expires for the NY Cut.

FIXED INCOME

• Bonds on the brink of a complete round trip from weekly peak to trough after hawkish-leaning Fed soundbites and poor US 30 year auction.
• Bunds, Gilts and T-note all nearer bases of 129.45-130.13, 94.70-95.32 and 107-10+/23 respective ranges.
• BTPs sub-112.00 and digesting Italy's multi tranche mid-month issuance
• Click here for more details.

COMMODITIES

• A very similar story to Thursday for the crude benchmarks, which are attempting to reclaim the modest ground they gained in the first half of that session before broader sentiment was hit by a poor US auction and Chair Powell.
• WTI Dec’23 and Brent Jan’23 are at the upper-end of USD 75.31-76.49/bbl and USD 79.79-80.86/bbl respectively; however, this leaves the benchmarks around USD 5/bbl shy of their WTD bests and almost USD 20/bbl off the early-October YTD peaks.
• Metals feature contained performance for spot gold, but with a slight negative bias as it eases back towards the WTD trough while base metals are pressured alongside the broader risk tone; XAU is back within relative proximity to the 200- and 100-DMAs of USD 1934/oz and USD 1927/oz respectively.
• Over 60 countries are reportedly backing a deal to triple renewable energy and shift away from coal, according to Reuters citing officials.
• Click here for more details.

NOTABLE HEADLINES

• SNB's Schlegel says a temporary increase in inflation via rent is possible.
• China's Vice Premier says they are willing to work with the EU to deepen practical cooperation in promoting industrial transformation and upgrades, via State Media; to jointly safeguard supply chain stability.
• Portugal's president dissolves parliament and calls snap elections, according to dpa. Portugal is to hold an election on March 10, 2024 according to AFR.
• Peru Central Bank cuts reference rate by 25bps to 7.00%, as expected.

EUROPEAN DATA

• UK GDP Estimate MM (Sep): 0.2% vs. Exp. 0.0% (prev. 0.2%, Rev. 0.1%); 3M/3M (Sep) 0.0% vs. Exp. -0.10% (Prev. 0.30%); YY (Sep) 1.3% vs. Exp. 1.00% (Prev. 0.50%)
• UK GDP Prelim. QQ (Q3) 0.0% vs. Exp. -0.1% (Prev. 0.2%); YY (Q3) 0.6% vs. Exp. 0.5% (Prev. 0.6%)
• Norwegian Consumer Price Index YY (Oct) 4.0% vs. Exp. 3.6% (Prev. 3.3%); Core Inflation YY (Oct) 6.0% vs. Exp. 5.6% (Prev. 5.7%)

NOTABLE US HEADLINES

• Meta (META) has reportedly struck a preliminary deal to sell a new, lower-priced version of its virtual-reality headset in China; the deal was struck with Tencent (700 HK), according to WSJ sources.
• Announcement on the US Federal Shutdown is imminent, according to Punchbowl; "laddered CR" and a continuing resolution into January are the options.
• Click here for the US Early Morning Note.

GEOPOLITICS

• "The Israeli army announces the cessation of its airstrikes in the Gaza Strip to mitigate civilian casualties", according to Sky News Arabia.
• Israeli military said it struck a position in Syria in response to Thursday's drone attack in Eilat, according to Reuters.
• Iranian Foreign Minister said expanding the scope of war has become inevitable with the increase in escalation in Gaza, according to Sky News Arabia.
• China's Ambassador to the US Feng says US-China relations are still facing severe challenges, and there is still a long way to go to stabilise and improve relations, according to Reuters.
• China Coast Guard, on the Philippines' resupply mission on Nov 10th, urged the Philippines to immediately stop infringing on China's sovereignty; Followed the Philippines' resupply vessels and took control measures, according to Reuters.
• Hungarian PM Orban says the EU must not begin membership discussions with Ukraine, via State Radio.

CRYPTO

• BlackRock's Ethereum (ETH) ETF plan is confirmed in Nasdaq filing, according to CoinDesk.

APAC TRADE

• APAC stocks traded lower across the board as the downbeat sentiment from Wall Street reverberated to the region following the poor 30-year US auction coupled with Powell’s hawkish lean, whilst the APAC region itself digested earnings and China’s ongoing woes.
• ASX 200 initially saw the shallowest losses among the majors as the RBA’s SoMP suggested the economy had been a bit stronger than previously thought, while sectoral losses were led by Tech, Financials, and Energy although Metal and Mining bucked the trend.
• Nikkei 225 was dragged lower by hefty post-earnings losses in Nissan, Sony, and Softbank, which were all lower by 3-6%, although the index later clambered off worst levels and rose back above 32,500.
• Hang Seng and Shanghai Comp conformed to the tone but Hong Kong was the regional underperformer with Tech and Financials, among the biggest losers.

NOTABLE HEADLINES

• A ransomware attack on the Industrial and Commercial Bank of China has disrupted the US Treasury market by stopping China's largest bank from settling Treasury trades, according to market participants cited by FT. SIFMA told members on Thursday that ICBC had been hit by ransomware software. The attack prevented ICBC from settling Treasury trades on behalf of other market participants. ICBC (1398 HK) Financial Services confirmed they experienced a ransomware attack that resulted in disruption to certain FS systems, according to Reuters.
• PBoC Governor said they are closely watching financial risks in some sectors; some provinces are facing a certain degree of debt risks and the central government is paying high attention to the matter, via state media
• PBoC policy adviser said China is able to achieve slightly above 5% GDP growth this year; consumption recovery still remains weak; fiscal deficit ratio can be raised next year. China's exports are still expected to face relatively big pressure next year. Weak external demand and inadequate domestic demand increase overcapacity pressure in China, according to Reuters.
• China Vice Premier He Lifeng said the important task for the meeting with US Treasury Secretary Yellen is to implement tasks from US President Biden and Chinese President Xi. He added talks with Yellen have been constructive, and will communicate China’s concerns about their economic and investment relationship with the US. Looking for effective measures to put US-China economic and trade relations back on track, according to Reuters.
• Country Garden Holdings (2007 HK) reportedly aims to inform key bondholders of its cash flow projections by year-end, according to Reuters sources; aims for a tentative plan to restructure offshore debt by year-end, and aims to start formal negotiations with offshore bondholders by February or March next year, sources added.
• PBoC injected CNY 203bln via 7-day reverse repos with the rate at 1.80% for a CNY 160bln net daily injection.
• Japanese government to top up fiscal loan and investment program with additional JYP 886bln in a second extra budget to beef up supply chain, according to a draft cited by Reuters.
• Japan mulls a 5%+ wage hike as a condition for tax breaks, via Sankei.
• BoJ is to conduct broad-based survey of companies behaviour since mid-90's; to be conducted between Nov'23-Feb'24 as part of its long term monetary policy review.
• RBA SoMP: considered the option to continue to hold policy rates steady but decided a hike would provide more assurance on inflation; Whether further tightening of monetary policy will depend on data. Click here for the full headline.
• New Zealand PM Hipkins said the Governor General will be advised to extend current caretaker government arrangements until a new government is formed, according to Reuters.

DATA RECAP

• China Oct vehicle sales +13.8% Y/Y (prev. +9.5%); new energy vehicle sales +33.5% Y/Y, according to the Industry Association.