• European bourses are near unchanged with specifics light but the DAX 40 & Healthcare lagging amid marked Bayer pressure
• Stateside, futures are slightly firmer in-fitting with the APAC bias but with action contained into a holiday-thinned week
• DXY pressured attempting to convincingly re-claim 103.50 with Yen & Yuan the main beneficiaries
• Core fixed benchmarks pressured but off lows ahead of US 20yr, BTPs outperform post-Moody’s
• Crude benchmarks continue Friday’s rebound as participants digest OPEC+ reports, spot gold soft but base metals bid
• Looking ahead, highlights include US Leading Index Change, New Zealand Trade, Speeches from ECB's de Cos, BoE’s Bailey, RBA’s Bullock & Schwartz, Supply from the US, and Earnings from Zoom Video Communications

EUROPEAN TRADE

EQUITIES

• European bourses in the green, Euro Stoxx 50 -0.1%, with action relatively contained overall in light macro newsflow after a slightly downbeat APAC handover.
• Sectors are mixed with Retail, Telecom & Utilities firmer given Cinco Dias reporting that Cellnex is looking into options for various units while Healthcare, alongside the DAX 40 -0.1%, is hampered by marked pressure in Bayer -20% after several negative updates.
• Stateside, futures are essentially flat going into a relatively light schedule expect for a 20yr auction before Tuesday's FOMC minutes and the Thanksgiving closures, ES +0.1%; NQ outperforms slightly as MSFT (+2.0%) extends in the pre-market.
• Microsoft (MSFT) CEO Nadella says former OpenAI executives Sam Altman and Greg Brockman are to join Microsoft to lead a new advanced AI research team.
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FX

• Dollar continues to retreat with DXY losing sight of 104.00 before finding some support sub-103.50 within 103.97-46 range.
• Yen and Yuan among main beneficiaries or architects of Buck depreciation as USD/JPY probes 148.50 from high just shy of 150.00 and USD/CNY, CNH top 7.1650 at best.
• Kiwi back above 0.6000 vs Greenback ahead of NZ trade data and Aussie over 0.6550 awaiting RBA speeches.
• Pound briefly back on 1.2500 handle and Euro reclaims 1.0900+ status
• PBoC set USD/CNY mid-point at 7.1612 vs exp. 7.2320 (prev. 7.1728)
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FIXED INCOME

• Debt futures regain composure to varying degrees after soaking up more offers.
• Gilts bounce firmly from 96.87 to 97.28, T-note tags along within a 108-16/25 range ahead of 20 year issuance and Bunds on coattails between 130.70-131.00 bounds.
• BTPs outperform mostly above 114.00 after Moody's Italian outlook upgrade to stable from negative
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COMMODITIES

• Crude benchmarks continue the rebound which began on Friday, where the contracts settled higher by circa. USD 3/bbl. Specifics have been light on Monday as participants digest Friday's/weekend OPEC+ reporting.
• Currently, WTI trades above USD 77.00/bbl (vs low 75.14/bbl) while Brent is just below USD 82/bbl in a USD 79.58-81.75/bbl intraday range.
• Energy Intel’s Bakr said she hasn’t heard of any ‘additional’ OPEC+ cuts being discussed at this time. On Friday, it was reported OPEC+ is to consider whether to deepen oil-output cuts at the next meeting on Nov 26th, according to Reuters OPEC+ sources. Additionally, on Friday, reports suggested Saudi Arabia is highly likely to extend its 1mln BPD cut at least until Spring, while an additional OPEC+ cut of up to 1mln BPD could be on the table, according to FT sources.
• Russia’s Gazprom and Venezuela’s PDVSA are to discuss new gas projects in Venezuela, according to RIA.
• Spot gold is a touch softer as yields remain higher and the DXY lifts from lows, but overall action is contained. Base metals are mostly firmer in a continuation of APAC action, where Shanghai Copper hit two-month highs. Elsewhere, Dalian iron ore extended amid Australian supply concerns around BHP train drivers taking industrial action.
• First Quantum, Cobre Panama Operation: Minera Panama has further ramped down operation at Cobre Panama to one remaining ore processing train. Without shipments arriving at Punta Rincon, expects to run out of on-site power plant supplies from Nov. 20th.
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NOTABLE HEADLINES

• UK Chancellor Hunt said he will not conduct any tax cuts that would make inflation worse and that the only way to reduce personal taxes is to spend public money more efficiently, while he responded that everything is on the table regarding the Autumn Statement when asked about reports of inheritance tax cuts. Hunt also stated that the tax burden is too high which he wants to bring down, according to Reuters. It was separately reported that Hunt is ‘considering’ a cut to income tax and national insurance in the Autumn Statement but may delay a widely anticipated reduction in inheritance tax until the spring budget, according to the Independent.
• UK PM Sunak says we believe in cutting taxes carefully and sustainably, approach starts with controlling inflation. Tax cuts don't automatically pay for themselves, Sunak says; can only cut taxes once inflation and debt is under control. To grow the economy, will need to take five long term decisions.
• ECB's Wunch says bet on rate cuts risk prompting hike instead; markets are optimistic to rule out further hiking; rates should stay unchanged in December and January.
• German government spokesperson says court ruling on climate fund means we're stepping in to new legal territory; all special funds are being reviewed now.
• Hungarian PM Orban said Hungary needs to change the EU not leave it, while he also stated that they will need to correct the mistaken promise to start talks about Ukraine’s EU membership.
• Fitch affirmed Spain on Friday at A-; Outlook Stable, while Moody’s raised Portugal’s rating by two notches from Baa2 to A3; Outlook Stable and affirmed Italy at Baa3; Outlook revised to Stable from Negative.
• Javier Milei won Argentina's presidential election against Sergio Massa who conceded defeat.

NOTABLE DATA

• German Producer Prices MM (Oct) -0.1% vs. Exp. -0.1% (Prev. -0.2%); YY -11.0% vs. Exp. -11.0% (Prev. -14.7%)

NOTABLE US HEADLINES

• Sam Altman will not return as OpenAI CEO after being fired on Friday and Emmet Shear is the new interim CEO, according to The Information. Over the weekend, OpenAI staff and investors were behind Sam Altman with Microsoft (MSFT) and venture groups exploring options to bring him back after board members fired him on Friday, according to FT.
• APEC leaders agreed to the 2023 Golden Gate Declaration after the conclusion of the meeting, while they reaffirmed the importance of the rules-based multilateral trading system with the WTO at its core and will continue to work to ensure a level playing field to foster a favourable trade and investment environment.

GEOPOLITICS

• Israel, Hamas and the US are close to an agreement to free dozens of hostages in Gaza in exchange for a five-day pause in fighting and were reported to have reached a tentative deal, according to the Washington Post. However, the White House said there is no deal yet and they continue to work hard to get a deal between Israel and Hamas.
• Israeli forces advanced in Gaza City as Israeli PM Netanyahu resisted calls for a ceasefire, according to FT. In relevant news, Israel’s ambassador to the US Herzog said Israel is hopeful a significant number of hostages could be freed in the coming days.
• US President Biden said in an Op-Ed article that a revitalised Palestinian authority should ultimately govern Gaza and the West Bank, while he added that the international community must establish a reconstruction mechanism to sustainably meet Gaza’s long-term needs.
• UN Secretary-General Guterres said he is deeply shocked that two UNRWA schools were struck in less than 24 hours in Gaza which killed and injured dozens of people. Guterres also said the civilian toll in Gaza is staggering and unacceptable, while he reiterated the call for an immediate humanitarian ceasefire.
• EU’s foreign policy chief Borrell said at a joint press conference with Qatari PM Al-Thani that the UN Security Council resolution on humanitarian pauses in Gaza must be implemented. It was also reported that Qatar’s PM said challenges to the hostages deal are now very minor and that sticking points in negotiations are practical and logistical, while he is more confident now that a deal can be reached on hostages.
• Iran’s Foreign Minister said resistance groups are cleverly adjusting pressure on Israel and its supporters and have an 'unactivated capacity' for pressure.
• Iran's Supreme Leader Khamenei called on Muslim states to at least cut off political ties with Israel for a limited period of time, according to TASNIM.
• Yemen’s Houthis said they will target all ships owned and operated by Israeli companies or carrying the Israeli flag, while the Houthis later announced that they seized an Israeli ship and took it to a Yemeni port.
• Chinese Foreign Minister Wang Yi said the international community must act now and take effective measures to end the humanitarian disaster regarding the Gaza situation and that China fully supports the Riyadh summit call for a two-state solution. Saudi's Foreign Minister also commented that they call for an immediate ceasefire and humanitarian assistance, while he added the international community needs to shoulder the responsibility to stop Israel.
• Turkish President Erdogan said Turkey will make efforts to rebuild damaged infrastructure, hospitals and schools in Gaza if a ceasefire is achieved, while he added that Turkey is making a call for nuclear weapons inspections in Israel so no doubt is left on the issue, according to Turkish media.
• Armenia and Azerbaijan agreed on basic principles of a peace treaty, according to TASS citing Armenia's PM.

CRYPTO

• Bitcoin is firmer on the session and extending further above the USD 35k mark, with specifics light at the start of a holiday shortened week and action largely a function of a negatively biased USD, thus far.

APAC TRADE

• APAC stocks were mostly positive albeit with gains capped amid the lack of fresh catalysts from over the weekend and as participants await this week’s key events including tomorrow's FOMC minutes release.
• ASX 200 finished marginally higher as strength in energy and financials was partly offset by losses in utilities and miners, while a quiet data calendar further added to the non-committal mood.
• Nikkei 225 swung between gains and losses in which an early rally saw the index climb above 33,850 and print its highest level since 1990, before wiping out all its gains and more.
• Hang Seng and Shanghai Comp outperformed amid resilience in tech and with the property sector underpinned by support pledges, while China’s latest benchmark 1-year and 5-year Loan Prime Rates were unsurprisingly maintained.

NOTABLE HEADLINES

• PBoC 1-Year Loan Prime Rate (Nov) 3.45% vs. Exp. 3.45% (Prev. 3.45%); 5-Year Loan Prime Rate 4.20% vs. Exp. 4.20% (Prev. 4.20%)
• China’s securities regulator will adopt different policies to address the risk of bond defaults by large real estate companies depending on their respective circumstances, according to Chinese financial media outlet Yicai.
• Taiwan’s APEC envoy Chang said he had informal interactions with US President Biden, Vice President Harris and Secretary of State Blinken but didn’t have any interactions with Chinese President Xi.
• China is reportedly drafting a "whitelist" of 50 developers for a financing boost, via Bloomberg; designed to guide institutions as they consider support for the industry.