• APAC stocks traded mixed with sentiment clouded after the recent soft US data and tumble in oil prices.
• European equity futures are indicative of a higher open with the Euro Stoxx 50 +0.4% after the cash market closed -0.3% yesterday.
• DXY is contained within a tight range, EUR/USD oscillates around 1.0850, USD/JPY slipped further below 151.
• Bunds pulled back from recent highs, crude is contained following yesterday's heavy selling.
• Looking ahead, highlights include UK Retail Sales, EZ CPI (Final), US Housing Starts, Speeches from ECB’s Lagarde, BoE's Ramsden, Fed’s Collins, Barr, Goolsbee & Daly.

US TRADE

EQUITIES

• US stocks were choppy as participants digested dovish data releases including a rise in jobless claims, falling import & export prices, disappointing Industrial Production and a tumble in the NAHB housing index which all helped drive US yields back towards their CPI lows. Furthermore, oil prices plunged to their lowest since July, while Walmart and Siemens were both cautious regarding the macro outlook following their earnings results.
• SPX +0.12% at 4,508, NDX +0.10% at 15,833, DJI -0.13% at 34,945, RUT -1.52% at 1,774.
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NOTABLE HEADLINES

• Fed's Cook (voter) believes that a soft landing is possible and noted that risks are two-sided, while she added they must balance the risk of not tightening policy enough against the risk of doing too much.
• Fed's Jefferson (voter), Cook (voter) and Kugler (voter) all see a case for a considerable balance sheet decline, according to a letter to US Senator Rick Scott cited by Reuters.
• Fed's Mester (2024 voter) said they need to see more evidence inflation is on its way to 2% and responded that the Fed will react to all the data not just one data point when asked about recent Fed repricing, according to CNBC.
• US President Biden said they have made substantial progress but noted they still have more work to do on the Indo-Pacific Economic Framework, while he added they are launching a critical minerals dialogue.

APAC TRADE

EQUITIES

• APAC stocks traded mixed with sentiment clouded after the recent soft US data and tumble in oil prices.
• ASX 200 marginally declined with notable underperformance in the energy sector after oil prices slumped to their lowest since July although the downside in the index was cushioned by resilience in miners and defensives.
• Nikkei 225 was indecisive before moving higher amid a lack of fresh catalysts and after balanced comments from BoJ Governor Ueda.
• Hang Seng and Shanghai Comp were pressured amid heavy losses in Alibaba shares after it scrapped its cloud business spinoff due to US chip restrictions and with energy names reeling from the tumble in oil prices.
• US equity futures were contained after the prior day's choppy mood and with sentiment in Asia mixed.
• European equity futures are indicative of a higher open with the Euro Stoxx 50 +0.4% after the cash market closed -0.3% yesterday.

FX

• DXY was rangebound with price action stuck to an extremely tight range between 104.31-104.40 as the recent bout of Fed rhetoric provided little to shift the dial and following yesterday’s intraday recovery whereby the initial data-induced selling was unwound after support held at 104.00.
• EUR/USD quietened after the prior day’s whipsawing with price action uneventful near the 1.0850 focal point.
• GBP/USD looks to test 1.2400 to the downside after the impulse from recent hawkish BoE commentary waned.
• USD/JPY trickled further beneath the 151.00 handle after the recent soft data stateside pressured US yields.
• Antipodeans were subdued in which AUD/USD and NZD/USD languished firmly beneath the 0.6500 and 0.6000 handles, respectively, owing to the subdued risk tone and recent commodity pressure.
• PBoC set USD/CNY mid-point at 7.1728 vs exp. 7.2473 (prev. 7.1724)

FIXED INCOME

• 10-year UST futures took a breather after advancing towards the 109.00 level on the back of soft data releases.
• Bund futures came off recent highs but with the pullback stemmed by support near the 131.00 level.
• 10yr JGB futures extended on this week’s advances north of 145.00 amid comments from BoJ Governor Ueda who reiterated that they will patiently maintain easy policy and noted that they cannot say yet with conviction that the price target will be stably and sustainably met.

COMMODITIES

• Crude futures were contained after the prior day's heavy selling which dragged oil into a bear market with WTI crude briefly below USD 73/bbl, while the pressure was attributed to weak US data, rising inventories and healthy supply.
• Iran set December Iranian light crude price to Asia at Oman/Dubai + USD 4.00/bbl, according to a Reuters source.
• US extended authorisation for certain transactions with PDVSA through to May 16th, 2024.
• Chevron (CVX) started delivering fuel to Venezuela's PDVSA after the easing of US sanctions and is to send a cargo of gasoline blend stock for November delivery, following the Naphtha cargo to PDVSA, according to Reuters sources.
• Libya's NOC announced the export of the first shipment from the Erawan oil field through the port of Zawiya.
• Spot gold held on to recent gains but with upside capped by resistance at yesterday's peak near USD 1988/oz.
• Copper futures were rangebound amid the overall mixed overnight risk tone and subdued mood in China.

CRYPTO

• Bitcoin notched mild gains after yesterday's intraday rebound from beneath the USD 36,000 level.

NOTABLE ASIA-PAC HEADLINES

• China President Xi said China will continue to improve foreign investment mechanisms and is to further shorten the negative list on foreign investment. Furthermore, Chinese President Xi told Japanese PM Kishida that peaceful coexistence, lasting friendship and cooperation will serve the fundamental interests of Chinese and Japanese people, while he added that both sides should focus on common interests and properly handle differences.
• Japanese PM Kishida said there are many areas of common interests as well as issues between Japan and China, while he was able to reaffirm that they will work towards a strategic relationship based on mutual interests. Kishida also stated that he sought a calm response from China regarding the release of Fukushima wastewater and conveyed strong concerns regarding the situation over the disputed Senkaku Islands, as well as China's increasing joint activities with Russia near Japanese waters.
• US lawmakers raised concerns that Chinese autonomous vehicle firms testing autonomous vehicles in California are collecting sensitive data, according to letters cited by newswires.
• Key US funds are slashing positions with exposure to China while focusing more on American technology giants, according to a Nikkei analysis.
• BoJ Governor Ueda said Japan's economy is recovering moderately which will likely continue and that they will patiently maintain easy policy, while he noted they cannot say yet with conviction that the price target will be stably and sustainably met. Ueda said they will consider ending YCC and the negative rate if they can expect inflation to stably sustain the target and in what order they will change policy will depend on economic, price and market developments at the time. Furthermore, he said making strong commitments now on how they could change policy could have unintended consequences in markets and the BoJ does not have a specific plan yet on how it will sell ETFs, while he also stated they cannot say now when the BoJ will change ultra-easy policy.

DATA RECAP

• Singapore Non-Oil Exports MM (Oct) 3.4% vs. Exp. 1.5% (Prev. 11.1%)
• Singapore Non-Oil Exports YY (Oct) -3.4% vs. Exp. -6.5% (Prev. 13.2%)

GEOPOLITICS

• Syrian air defences confronted enemy targets and shot down Israeli missiles fired from Golan Heights.
• US Secretary of State Blinken spoke with Israeli Minister Gantz and discussed efforts to accelerate the transit of humanitarian aid into Gaza, as well as efforts to prevent the conflict from widening and to secure the release of hostages. Blinken also stressed the urgent need for affirmative steps to de-escalate tensions in the West Bank including confronting rising levels of settler extremist violence.

EU/UK

NOTABLE HEADLINES

• BoE's Mann said low UK productivity limits the potential for growth.
• German government coalition agreed to raise VAT for food in restaurants back to 19% from 7% starting in 2024, according to Handelsblatt. It was separately reported that Germany's budget committee interrupted the final deliberations on the 2024 draft budget, according to budget committee representatives.