Notes/Observations
- European participation low due to Armistice Day holiday; little data releases scheduled
- US banks closed for Veterans day but equity markets open
Asia:
- New Zealand Central Bank (RBNZ) left the Official Cash Rate (OCR) unchanged at 0.25% (as expected). It maintained QE bond purchases at NZ$100B and announce to implement an Funding for Lending Program (FLP) in early December 2020
- RBNZ Gov Orr post rate decision press conference noted that inflation and employment would be below target for a long time; Funding for Lending program worth NZ$28B; too early to tell on negative OCR
- South Korea Oct Unemployment Rate hit a 6-month high (4.2% v 3.9% prior)
- Deals reached at the third China International Import Expo (CIIE) totaled $72.6B, +2.1% y/y
- China passed a ‘patriotism’ requirement for Hong Kong Lawmakers; Law could allow immediate disqualification of lawmakers that endanger national security. The resolution could give the Hong Kong govt the power to disqualify lawmakers without going through the court
Coronaviurs:
- Total global cases: 51.4M (+1.0% y/y); total deaths: 1,27M (+0.6% d/d)
Americas:
- President-elect Biden stated that Trump not acknowledging the election outcome would not affect transition planning; planning was well underway, Would be nice to have Trump’s concession, but its not critical; Biden added that he had not spoken to Senate Majority Leader McConnell yet but expect to do so soon
- Trump Campaign filed lawsuit in Michigan to stop certification of Biden’s win
Energy:
- Weekly API Crude Oil Inventories: -5.1M v -8.0M prior
SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM
Equities
- Indices [Stoxx600 +0.6% at 386.7, FTSE +0.5% at 6329, DAX +0.5% at 13224, CAC-40 +0.4% at 5440, IBEX-35 +0.1% at 7722, FTSE MIB +0.4% at 20929, SMI +1.3% at 10496, S&P 500 Futures +0.7%]
- Market Focal Points/Key Themes: European indices open modestly higher (AEX notable exception) and traded in the green across the board later in the session; better performing sectors include energy and consumer discretionary; technology and materials sectors among those underperforming; reportedly France ready with new nuclear law; reportedly UK to review takeover laws; Sampo cuts stake in Nordea, with speculation might use proceeds for TopDenmark; earnings expected in the upcoming US session include Alcon, Morphosys, Pirelli and Air Products
Equities
- Consumer discretionary: Bechtle BC8.BE +11.8% (results), D’ieteren DIE.BE +13.0% (guidance), Flutter Entertainment FLTR.UK +4.8% (results), International Consolidated Airlines IAG.UK +3.8% (analyst action), Salvatore Ferragamo SFER.IT +2.5% (results)
- Energy: CGG CCC.FR +3.7% (analyst action), Nordex NDX1.DE +5.9% (awarded order)
- Financials: ABN Amro ABN.NL +18.1% (results), Nordea NDA.SE -4.5% (Sampo cuts stake), Sampo SAMAS.FI +0.9% (cuts stake in Nordea)
- Healthcare: Alcon ALC.CH +4.2% (results), Ambu AMBUB.DK -4.9% (results), Bavarian Nordic BAVA.DK +3.0% (results), Mereo Biopharma MPH.UK -23.5% (to delist from AIM)
- Industrials: BAE Systems BA.UK +2.5% (trading update), Renold RNO.UK +5.5% (results), Vallourec VK.FR -2.7% (licencing deal)
- Technology: Ricardo RCDO.UK -7.9% (share issue, results)
- Telecom: Mediaset MS.IT +6.5% (results), NOS NOS.PT -4.5% (analyst action), Telecom Italia TIT.IT +1.2% (results)
- Utilities: E.on EOAN.DE +1.0% (results)
Speakers
- EU-UK negotiators said to likely miss the mid-Nov deadline to reach a trade agreement. Current talks in London to break a deadlock were expected to run through the end of this week (aka Nov 13th). Negotiators said to be expected to come up with an agreed text in the middle of next week (around Nov 18th) unless talks collapsed or there is a breakthrough earlier.
- Sweden Central Bank (Riksbank) Financial Stability Report saw elevated risk to stability. If the crisis deepened and became more prolonged then additional measures might be needed to support credit supply and safeguard financial stability
- Russia Central Bank (CBR) Gov Nabiullina reiterated stance that still had space for further easing
- Philippines Central Bank (BSP) noted that low inflation provided room to lower the Reserve ratio Requirement (RRR)
- China Foreign Ministry spokesperson Wang Wenbin warned against foreign govts from commenting on its recent Hong Kong measures
- China Construction Bank President Liu said to become PBOC Dep Gov [the timing of the appointment is uncertain
- Hong Kong opposition parliamentary members said to have quit in protest against China
Currencies/Fixed Income
- GBP was softer as mid-session approached after reports circulated that EU-UK Brexit negotiators were likely to miss a mid-Nov deadline to reach a trade agreement. The report added that talks would continue into next week. GBP/USD off its recent 2-month highs and was at 1.3265 by mid-session.
- NZD currency (kiwi) was firmer as market participants pared back bets on negative rate policy in New Zealand. NZD/USD higher by 0.8% at 0.6885
Economic Data
- (SE) Sweden Oct PES Unemployment Rate: 5.0% v 5.3% prior
- (RO) Romania Oct CPI M/M: 0.2% v 0.2%e; Y/Y: 2.2% v 2.3%e
- (TR) Turkey Sept Current Account Balance: -$2.4B v -$2.6Be
- (CN) China Oct Aggregate Financing (CNY) 1.420T v 1.400Te
- (CN) China Oct New Yuan Loans (CNY) 689.8B v 775.0Be
- (CN) China Oct M2 Money Supply Y/Y: 10.5% v 10.9%e
Fixed income Issuance
- (UK) DMO sold £800M in 0.125% Nov 2036 inflation-linked Gilts; (UKTi) ; Real Yield: -2.381% v -2.550% prior; bid-to-cover: 1.74x v 2.52x prior
- (IT) Italy Debt Agency (Tesoro) sold €5.5B vs. €5.5B indicated in 12-month Bills; Avg Yield: -0.478% v -0.436% prior; Bid-to-cover: 1.84x v 1.72x prior
- (SE) Sweden sold SEK10.0B vs. SEK10.0B indicated in 3-month bills; Avg Yield: -0.2025% v -0.2026% prior; Bid-to-cover: 2.81x v 4.26x prior
- (NO) Norway sold NOK2.0B vs. NOK2.0B indicated in 2023 bonds; Avg Yield: 0.30% v 0.27% prior; bid-to-cover: 3.05x v 2.62x prior
Looking Ahead
- (MX) Mexico Oct ANTAD Same-Store Sales Y/Y: No est v -0.3% prior
- 05:30 (HU) Hungary Debt Agency (AKK) to sell 12-month bill
- 05:30 (DE) Germany to sell €1.0B in 0% Aug 2050 Bunds
- 06:00 (CZ) Czech Republic to sell combined CZK9.0B in 2027, 2029 and 2030 bonds
- 06:00 (RU) Russia to sell 2027 and 2035 OFZ bonds
- 06:00 (PT) Portugal Oct Final CPI M/M: No est v 0.1% prelim; Y/Y: No est v -0.1% prelim
- 06:00 (PT) Portugal Oct Final CPI EU Harmonized M/M: No est v -0.1% prelim; Y/Y: No est v -0.6% prelim
- 07:00 (US) MBA Mortgage Applications w/e Nov 6th: No est v 3.8% prior
- 07:00 (MX) Mexico Sept Industrial Production M/M: 0.8%e v 3.3% prior; Y/Y: -6.2%e v -9.0% prior; Manufacturing Production Y/Y: -7.2%e v -9.2% prior
- 07:00 (BR) Brazil Sept Retail Sales M/M: 1.4%e v 3.4% prior; Y/Y: 8.7%e v 6.1% prior
- 07:00 (BR) Brazil Sept Broad Retail Sales M/M: 1.5%e v 4.6% prior; Y/Y: 7.9%e v 3.9% prior
- 07:00 (UK) Weekly PM Question time in House
- 08:00 (RU) Russia Sept Trade Balance: $4.6Be v $3.7B prior; Exports: $23.9Be v $23.3B prior; Imports: $19.0Be v $19.5B prior
- 08:00 (UK) Daily Baltic Dry Bulk Index
- 08:00 (EU) ECB chief Lagarde at ECB Forum on Central Banking
- 09:30 (SE) Sweden FSA chief Thedeen
- 09:45 (UK) BOE to buy £1.47B in APF Gilt purchase operation (7-20 years)
- 10:30 (US) Weekly DOE Oil Inventories
- 16:00 (KR) South Korea Oct Export Price Index M/M: No est v -0.3% prior; Y/Y: No est v-6.2% prior
- 16:00 (KR) South Korea Oct Import Price Index M/M: No est v -11.5% prior; Y/Y: No est v-1.3% prior
- 16:45 (NZ) New Zealand Sept Net Migration: No est v 1.1K prior
- 18:30 (AU) Australia to sell A$1.0B in 3-month bills
- 18:50 (JP) Japan Oct PPI M/M: -0.1%e v -0.2% prior; Y/Y: -2.0%e v -0.8% prior
- 18:50 (JP) Japan Sept Core Machine Orders M/M: -1.0%e v +0.2% prior; Y/Y: -12.0%e v -15.2% prior
- 19:00 (AU) Australia Nov Consumer Inflation Expectation Survey: No est v 3.4% prior
- 19:01 (UK) Oct RICS House Price Balance: 54%e v 61% prior
- 21:00 (JP) Japan Oct Tokyo Avg Office Vacancies: No est v 3.43 prior
- 22:30 (TH) Thailand Oct Consumer Confidence: No est v 50.2 prior; Economic Confidence: No est v 42.9 prior
- 22:35 (JP) Japan to sell 5-Year JGB Bonds
- 23:30 (JP) Japan Sept Tertiary Industry Index M/M: 1.2%e v 0.8% prior
