• European equities extend gains; FTSE100 propped up by mining names; US futures contained pre-Powell
• DXY is marginally weaker, with mild outperformance in the Kiwi post-hawkish commentary from Hawkesby
• Bonds bounce and back on a firmer footing, after steep month-end retracement
• Crude contained post-OPEC; base metals boosted by the softer Dollar & firmer Chinese data
• Israel's military said that Hamas violated the truce and fired towards Israeli territory, while it has resumed combat against Hamas in Gaza
• Looking ahead, US and Canadian Manufacturing PMI (Final), Canadian Unemployment Rate, Speeches from Fed’s Powell, Goolsbee & Cook, ECB's Lagarde

EUROPEAN TRADE

EQUITIES

• European equities, Eurostoxx50, +0.5%, are extending gains; FTSE100, +0.8%, which has been lifted by mining-related stocks.
• European sectors are mostly in the green, with significant outperformance in Basic Resources, being propped up by mining stocks following broker upgrades at Anglo American, +6.4%, and Antofagasta, +4.7%; Optimised Personal Care & Grocery is marginally hampered by a Tesco, -1.3%, downgrade.
• US Futures are trading on the front foot, albeit to a lesser extent in comparison to their European counterparts ahead of ISM & Powell; RTY, +0.3%, slightly outperforms.
• Click here and here for the sessions European pre-market equity newsflow, including earnings.
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FX

• Dollar drifts after month-end revival awaiting US manufacturing ISM for interim impetus before guidance from Fed Chair Powell; DXY dithering within 103.45-26 range.
• Kiwi back in sight of 0.6200 vs Greenback after hawkish RBNZ rhetoric from Hawkesby.
• Aussie encouraged by China's Caixin manufacturing PMI rebound to 50.0+ level as AUD/USD hold above 0.6600.
• Loonie underpinned ahead of Canadian LFS with USD/CAD sub-1.3550.
• Cable firm on 1.2600 handle after upward revision to final UK manufacturing PMI.
• Euro tethered to 1.0900 vs Dollar amidst nearby option expiries and post-mostly better than flash or forecast Eurozone manufacturing PMIs.
• PBoC set USD/CNY mid-point at 7.1104 vs exp. 7.1458 (prev. 7.1018).
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FIXED INCOME

• Debt futures back on a firmer footing, on balance, after steep month end retracement.
• Bunds bounce further from sub-132.00 towards 133.00 again.
• Gilts towards top of 96.80-25 range, but still lagging in run up to Fitch UK rating review.
• T-note hovering around 110-00 within 110-04/109-27+ confines awaiting US manufacturing ISM and Fed speakers headlined by Chair Powell twice.
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COMMODITIES

• WTI and Brent are modestly firmer intraday in the aftermath of the OPEC+ confab on Thursday which ultimately underwhelmed the market given that output cuts are voluntary; as it stands, benchmarks are holding incrementally above the unchanged mark in narrow ranges around the prior session's trough.
• Spot gold holds an upward bias as the Dollar remains subdued; Base metals are firmer across the board amid upbeat Chinese data overnight, and upward bias in risk sentiment in Europe.
• OPEC Secretariat announced several OPEC+ countries will conduct additional voluntary cuts to the total of 2.2mln BPD (exp. 2.0mln). It was confirmed that Brazil will join OPEC+ from January 2024.
• Saudi Arabia will extend its voluntary cut of 1mln BPD to the end of Q1 2024 with its production to be approx. 9mln BPD and Russia is also to extend its voluntary cut in oil supplies until the end of Q1 2024 with its voluntary supply cut to reach 500k BPD. Kuwait is to make a further 135k BPD OPEC+ oil output cut, while the UAE is to make an additional 160k BPD OPEC+ output cut and Iraq is said to cut its production by 220k BPD in Q1. Conversely, Angola rejected its OPEC quota for 1.11mln BPD and said it will produce 1.18mln BPD, according to Bloomberg. Click here for the detailed headline.
• US is purchasing 2.73mln bbls of oil for the strategic reserve, according to a document cited by Reuters.
• US aims to halve Russia's energy revenue by 2030, while Assistant Secretary of State for Energy Resources Pyatt said Western sanctions will continue for years to come to curb Moscow's war machine, according to FT.
• US President Biden and Angola's President welcomed the launch of a US-Angola energy security dialogue in 2024 during a meeting on Thursday, according to the White House
• US State Department said the US reiterated its pledge to ‘reconsider’ the steps it took to ease sanctions on Venezuela if the latter fails to comply with certain commitments by the end-November deadline, while it added that Venezuela must define steps for lifting bans on opposition candidates and begin the release of Venezuelan political prisoners and wrongfully detained Americans. It was later reported that banned Venezuelan candidates would be allowed to take their cases to a tribunal.
• Morgan Stanley says commitment to new OPEC+ cuts appears to be uncertain, expect compliance to only be partial, Foresees Saudi Arabia ultimately extending the cuts to Q2-2024. Maintain Brent forecast at USD 85/bb and flat throughout 2024. Lowered OPEC+ production forecast for Q1-2024 by 0.6mln BPD, still see the oil market turning into a small surplus again in Q2 & Q3.
• Russia's Kremlin says OPEC+ contributes to stabilisation of energy markets and creation of conditions for supporting energy prices at a balanced level; Russia is interested in continuing working with OPEC+.
• First Quantum is suspending production guidance for Cobre Panama for the current year
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NOTABLE EUROPEAN HEADLINES

• ECB's Nagel said recent inflation developments are encouraging but the ECB cannot be satisfied yet and inflation risks are still on the upside so a further rate hike cannot be ruled out. Nagel also stated that longer-term inflation expectations are still some way from 2% and that a leaner ECB balance sheet is desirable and the reduction can accelerate, while he added it is far too early to discuss rate cuts.
• EU weighs concessions in the US steel feud amid concerns over a Trump return, according to Bloomberg sources.
• German government spokesperson, re. budget talks, says they are aware of the urgency and there is a lot of momentum to solve this as soon as possible

DATA RECAP

• EZ Manufacturing PMIs generally saw revisions higher from the preliminary results.
• EU HCOB Manufacturing Final PMI (Nov) 44.2 vs. Exp. 43.8 (Prev. 43.8)
• Spanish HCOB Manufacturing PMI (Nov) 46.3 vs. Exp. 45.5 (Prev. 45.1)
• Italian HCOB Manufacturing PMI (Nov) 44.4 vs. Exp. 45.3 (Prev. 44.9)
• French S&P Global Manufacturing PMI (Nov) 42.9 vs. Exp. 42.6 (Prev. 42.6)
• German HCOB Manufacturing PMI (Nov) 42.6 vs. Exp. 42.3 (Prev. 42.3)
• UK S&P Global/CIPS Manufacturing PMI Final (Nov) 47.2 vs. Exp. 46.7 (Prev. 46.7)
• Swiss GDP QQ (Q3) 0.3% vs. Exp. 0.1% (Rev. -0.1%); YY 0.3% vs. Exp. 0.5% (Prev. 0.5%, Rev. 0.3%)

NOTABLE US HEADLINES

• Fed's Barr (Voter, Neutral): Fed discount window borrowing should not have stigma, wants banks to se the discount window for their funding needs.
• Fed rate hikes are probably over, but officials are reluctant to say so, via WSJ's Timiraos; on track to hold rates steady at the December gathering while maintaining public guidance that the next move is more likely to be a hike rather than a cut.
• Marvell Technology Inc (MRVL) Q3 2024 (USD): EPS 0.41 (exp. 0.40), Revenue 1.42bln (exp. 1.40bln). Shares seen -4.9% in pre-market trade
• Dell Technologies Inc (DELL) Q3 2023 (USD): Adj. EPS 1.88 (exp. 1.47), Revenue 22.25bln (exp. 23.bln); revenue miss due to a slower-than-expected recovery in the hardware and software market. Shares seen -5.5% in pre-market trade
• Disney (DIS) reinstates quarterly dividend of USD 0.30/shr. Shares seen +0.7% in pre-market trade
• Click here for the US Early Morning Note.

GEOPOLITICS

ISRAEL-HAMAS

• Israel's military said that Hamas violated the truce and fired towards Israeli territory, while it has resumed combat against Hamas in Gaza
• Initial reports suggested Israel and Hamas agreed to extend the truce for an eighth day, according to Egyptian officials cited by WSJ. However, there was no official statement made by Israel, Hamas or mediator Qatar.
• Rocket sirens sounded in Israeli areas near the Gaza border and the Israeli military said one launch was detected from Gaza which was intercepted, while Hamas-affiliated media reported that explosions and gunfire were heard in the northern Gaza Strip. Furthermore, Israeli planes were reportedly flying over Gaza and Israeli army vehicles are firing in the northwest of the Gaza Strip, according to a correspondent cited by Al Jazeera.
• The Israeli army raises the alert on the border with Lebanon, according to Al Arabiya
• Qatari and Egyptian mediators have been in contact with Hamas and Israel since fighting resumed in Gaza on Friday, according to Reuters citing sources; negotiations between both sides is continuing
• Senior Hezbollah member says Lebanon remain ready to confront any danger from Israel, adds Gaza developments can still affect the Lebanon situation

North-Korea

• US Treasury Department issued new North Korean sanctions targeting 8 individuals and the hacking group Kimsuky, while South Korea imposed sanctions on 11 North Korean individuals, according to the Foreign Ministry.

CRYPTO

• Bitcoin, USD 38.6k, extends gains and pushes above a triple top to an 18-month peak, with Ethereum also firmly in the green.

APAC TRADE

• APAC stocks began the new month with price action rangebound as markets paused following the November rally amid another busy day of economic releases, while the conflict in Gaza also resumed.
• ASX 200 was dragged lower by underperformance in tech and consumer-related sectors amid higher yields.
• Nikkei 225 traded indecisively as encouraging data releases offset the headwinds from early currency strength.
• Hang Seng and Shanghai Comp were gradually pressured following the PBoC’s substantial net liquidity drain, whilst the latter eventually moved into the green amid reports China state-owned capital operating Co. reportedly bought ETFs on Friday, whilst the session also saw a surprise return to expansion territory for the Chinese Caixin Manufacturing PMI.

NOTABLE HEADLINES

• China state-owned capital operating Co. reportedly bought ETFs on Friday, according to Bloomberg.
• US judge blocked the Montana state ban on Tiktok from taking effect, according to a court order.
• US lawmakers seek a Biden administration investigation into Chinese drone maker Autel Robotics due to national security concerns.
• Japan's largest trade union RENGO said it formally agreed on a 2024 pay hike demand of 5% or more, according to Reuters.

DATA RECAP

• Chinese Caixin Manufacturing PMI Final (Nov) 50.7 vs. Exp. 49.8 (Prev. 49.5)
• Japanese Unemployment Rate (Oct) 2.5% vs. Exp. 2.6% (Prev. 2.6%)
• Japanese Jobs/Applicants Ratio (Oct) 1.30 vs. Exp. 1.29 (Prev. 1.29)
• Japanese Company Profits Y/Y (Q3) 20.1% vs Exp. 13.8% (Prev. 11.6%)
• Japanese Company Sales Y/Y (Q3) 5.0% vs Exp. 4.5% (Prev. 5.8%)