• APAC stocks declined following the mostly negative lead from Wall St where the major indices were choppy and ultimately weighed amid a rebound in yields ahead of key data releases.
• RBA kept the Cash Rate Target unchanged at 4.35%, as expected, while it reiterated its forward guidance; Chinese Caixin Services PMI topped forecasts; Tokyo CPI printed below expectations.
• Saudi's Energy Minister said OPEC+ cuts can 'absolutely' go beyond Q1 and they will not agree to a fossil fuel phase down, while he added that cuts will address the inventory build in Q1 and OPEC+ 2.2mln BPD cuts will be delivered.
• China's major state-owned banks were seen acquiring dollars via onshore swaps and selling them in the spot FX market, while it was also reported that the RBI was likely selling dollars near the 83.38-83.39 rupee level, according to sources and traders cited by Reuters.
• Looking ahead, highlights include EZ, UK, US Composite & Services Final PMIs, Spanish & French Industrial Output, US JOLTS, Australian AIG Manufacturing Index, ECB Consumer Expectations Survey, Supply from UK & Germany.

US TRADE

EQUITIES

• US stocks traded mixed and the major indices finished lower amid a rebound in yields and a lack of fresh drivers, while participants await the upcoming risk events including several key data releases from the US including the latest US NFP report on Friday.
• SPX -0.54% at 4,569, NDX -0.99% at 15,839, DJIA -0.11% at 36,204, RUT +1.04% at 1,882.
• Click here for a detailed summary.

APAC TRADE

EQUITIES

• APAC stocks declined following the mostly negative lead from Wall St where the major indices were choppy and ultimately weighed amid a rebound in yields ahead of key data releases.
• ASX 200 was led lower by the commodity-related industries with underperformance in gold miners after the precious metal faded the recent surge, while sentiment was also not helped by weak data and after the unsurprising RBA rate decision in which the central bank kept rates unchanged and reiterated its forward guidance.
• Nikkei 225 continued to weaken and slipped below the 33,000 level despite softer-than-expected Tokyo inflation data.
• Hang Seng and Shanghai Comp retreated which saw the latter breach the psychological 3,000 level to the downside amid lingering frictions after China criticised the US for seeing it as a threat following calls by Commerce Secretary Raimondo for more funds to back chip curbs, while encouraging Caixin Services PMI data which printed a 3-month high at 51.5 (exp. 50.7) only provided a brief tailwind.
• US equity futures were lacklustre amid the risk-aversion in Asia and with participants bracing for the upcoming data.
• European equity futures are indicative of a modestly firmer open with Euro Stoxx 50 future +0.1% after the cash market closed down 0.1% yesterday.

FX

• DXY was uneventful with price action contained within a thin range of 103.53-103.66 following the prior day’s advances which were on the back of a rebound in yields after markets seemingly got ahead of themselves regarding Fed rate cut expectations.
• EUR/USD remained lacklustre but off the prior day’s lows after finding support near the 1.0800 level.
• GBP/USD traded little changed amid a lack of macro drivers from the UK ahead of Services PMI data.
• USD/JPY was restricted amid the risk-off mood but with the downside stemmed by support around the 147.00 level and following softer-than-expected Tokyo inflation data which is seen as a leading indicator of the national trend.
• Antipodeans weakened due to the risk-off mood and with AUD/USD pressured following the RBA policy announcement in which the central bank kept rates unchanged at 4.35%, as expected, while it reiterated its forward guidance and refrained from any hawkish surprises.
• PBoC set USD/CNY mid-point at 7.1127 vs exp. 7.1476 (prev. 7.1011).
• China's major state-owned banks were seen acquiring dollars via onshore swaps and selling them in the spot FX market, while it was also reported that the RBI was likely selling dollars near the 83.38-83.39 rupee level, according to sources and traders cited by Reuters.

FIXED INCOME

• 10-year UST futures rebounded from the prior day’s bear-flattening with markets consolidating after the recent Fed rate cut bets.
• Bund futures were steady near 133.50 ahead of German supply and with prices kept afloat alongside the downbeat risk appetite.
• 10-year JGB futures lacked firm direction despite softer Tokyo inflation and following mixed results from the latest 10-year JGB auction.

COMMODITIES

• Crude futures traded sideways after yesterday's choppy performance in a continued fallout from the OPEC+ meeting and against the backdrop of cooling economic data in the US and volatile Middle East tensions.
• Saudi's Energy Minister said OPEC+ cuts can 'absolutely' go beyond Q1 and they will not agree to a fossil fuel phase down, while he added that cuts will address the inventory build in Q1 and OPEC+ 2.2mln BPD cuts will be delivered.
• Spot gold attempts to compose itself after fully reversing this week's initial spike with prices below USD 2040/oz.
• Copper futures languished at the prior day's lows around USD 3.83/lb amid the broad downbeat risk tone.

CRYPTO

• Bitcoin marginally declined as it took a breather from the recent surge that briefly lifted prices above USD 42,000.

NOTABLE ASIA-PAC HEADLINES

• RBA kept the Cash Rate Target unchanged at 4.35%, as expected, while it reiterated its forward guidance that whether further tightening is required to ensure inflation returns to the target in a reasonable timeframe will depend upon data and evolving assessment of risks. RBA also repeated that the Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that outcome, as well as noted there are still significant uncertainties around the outlook and that the limited information received on the domestic economy since the November meeting has been broadly in line with expectations.

DATA RECAP

• Chinese Caixin Services PMI (Nov) 51.5 vs. Exp. 50.7 (Prev. 50.4)
• Chinese Caixin Composite PMI (Nov) 51.6 (Prev. 50.0)
• Tokyo CPI YY (Nov) 2.6% vs. Exp. 3.0% (Prev. 3.3%)
• Tokyo CPI Ex. Fresh Food YY (Nov) 2.3% vs. Exp. 2.4% (Prev. 2.7%)
• Tokyo CPI Ex. Fresh Food & Energy YY (Nov) 3.6% vs. Exp. 3.7% (Prev. 3.8%)
• Australian Current Account Balance (AUD)(Q3) -0.2B vs. Exp. 3.1B (Prev. 7.7B)
• Australian Net Exports Contribution (Q3) -0.6% vs. Exp. -0.2% (Prev. 0.8%)

GEOPOLITICS

• Israel is reportedly mulling a plan to flood Gaza tunnels with seawater, according to WSJ.
• Israel's army said its fighter jets attacked Hezbollah positions, infrastructure and military in response to a recent shooting, according to AJABreaking via social media platform X.
• Investors with prior knowledge of the October 7th attack on Israel by Hamas made at least tens of millions of pounds shorting Israeli stocks, according to The Telegraph.
• US National Security Advisor Sullivan said attacks on vessels in the Red Sea are a threat to international peace and stability, while they have every reason to believe these attacks were fully enabled by Iran. Sullivan also said the US is engaging with allies on the next steps after the Red Sea attacks and weapons used by the Houthis in the attacks are being supplied by Iran.
• White House warned that a failure to approve additional aid for Ukraine would 'kneecap' Kyiv, according to FT.

EU/UK

NOTABLE HEADLINES

• YouGov/Citi survey showed the British public's expectation for inflation in 5yr-10yr's time rose to 3.5% from a prior 3.3% view in September.

DATA RECAP

• UK BRC Retail Sales YY (Nov) 2.6% vs. Exp. 2.5% (Prev. 2.6%)