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APAC stocks were mostly subdued with the region failing to sustain the positive global risk momentum that had been spurred by US-China trade optimism and US government reopening hopes, while there were few fresh catalysts overnight to fuel the recent rally. US Senate voted 60 vs. 40 to pass legislation to fund the federal government and end the shutdown, while the bill now goes to the House. US House Speaker Johnson is seeking a Wednesday vote on the stopgap bill, and won't commit to an ACA subsidy vote. China is reportedly devising a plan to keep the US military from getting its rare earth magnets and is considering a ‘validated end-user’ system to fast-track certain export licenses, according to WSJ. European equity futures indicate a positive cash market open with Euro Stoxx 50 futures up 0.4% after the cash market finished with gains of 1.8% on Monday. Looking ahead, highlights include UK Unemployment/Wages (Sep), EZ & German ZEW (Nov), US NFIB (Oct), Weekly Prelim Estimate ADP, Riksbank Minutes, Speakers including ECB’s Lagarde, BoE’s Greene & Dhingra, RBA’s Jones, Supply from Netherlands, Earnings from Porsche SE, RWE & Alcon. Holidays: US Veterans' Day; Canadian Remembrance Day SNAPSHOT Click for the Newsquawk Week Ahead. Newsquawk in 3 steps: 1. Subscribe to the free premarket movers reports 2. Listen to this report in the market open podcast (available on Apple and Spotify) 3. Trial Newsquawk’s premium real-time audio news squawk box for 7 days US TRADE EQUITIES US stocks closed the first trading session of the week in the green amid risk-on sentiment as the US Senate took the first steps over the weekend to end the US government shutdown, alongside continued positive US/China trade developments. Sectors were predominantly firmer with mega-cap sectors Technology, Communications, and Discretionary outperforming with all Mag-7 names in positive territory, while Consumer Staples was one of the few industries in the red. SPX +1.54% at 6,832, NDX +2.20% at 25,612, DJI +0.81% at 47,369, RUT +0.97% at 2,456. Click here for a detailed summary. TARIFFS/TRADE US President Trump said they are making a deal with India, which is different to the one in the past, and are getting close. US President Trump posted on Truth "The “Pay Back” Number on tariffs... are much higher than those being stated by our Fake Opposition...would be in excess of $2 Trillion Dollars". China is reportedly devising a plan to keep the US military from getting its rare earth magnets and is considering a ‘validated end-user’ system to fast-track certain export licenses, according to WSJ. China's Foreign Minister Wang held a phone call with Canada's Foreign Minister on Tuesday and said China is willing to strengthen communication with Canada and willing to accelerate the resumption of exchanges and cooperation in various fields, while he added that diplomatic, commercial and other departments of their countries can properly resolve concerns. EU reportedly eyes banning Huawei from mobile networks of member countries, with the European Commission exploring making its 2020 guidance on excluding high-risk telecom vendors legally binding, according to Bloomberg. Switzerland is nearing a deal to cut the US tariff on its exports to 15% from 39%, with an agreement possible within two weeks. Negotiations accelerated after Swiss executives met with US President Trump, who directed USTR Greer to intensify talks, while Switzerland seeks relief as the initial levy hurt growth and pushed unemployment to a four-year high, according to Bloomberg. NOTABLE HEADLINES US Senate voted 60 vs. 40 to pass legislation to fund the federal government and end the shutdown, while the bill now goes to the House. US House Speaker Johnson is seeking a Wednesday vote on the stopgap bill, and won't commit to an ACA subsidy vote. Apple (AAPL) reportedly pulled the next-gen iPhone Air off its release schedule next fall, while manufacturing partners have already stopped or cut production of the first iPhone Air, according to The Information. APAC TRADE EQUITIES APAC stocks were mostly subdued with the region failing to sustain the positive global risk momentum that had been spurred by US-China trade optimism and US government reopening hopes, while there were few fresh catalysts overnight to fuel the recent rally. ASX 200 faded its early advances as the outperformance in gold stocks and miners was negated by weakness in tech and the top-weighted financial sector following CBA's modest earnings growth, while the improvement in Consumer Sentiment to a 7-year high did little to spur risk appetite. Nikkei 225 initially rallied amid currency weakness and as participants digested earnings results, but eventually wiped out all of its gains as sentiment soured. Hang Seng and Shanghai Comp were pressured amid losses in tech, including Chinese e-commerce giants Alibaba and JD.com, which failed to benefit, despite it being China's Singles' Day, which is the world's largest shopping event, as sales had begun weeks earlier in an effort to boost sluggish spending. US equity futures were uneventful and held on to most of yesterday's spoils in the absence of any fresh major drivers. European equity futures indicate a positive cash market open with Euro Stoxx 50 futures up 0.4% after the cash market finished with gains of 1.8% on Monday. FX DXY traded flat after marginally softening at the start of the week, with little reaction seen following the Senate's passage of the government funding bill, which was as expected, and now goes to the House for approval with House Speaker Johnson seeking a Wednesday vote on the stopgap bill. Elsewhere, newsflow was relatively sparse, although there were recent comments from Fed officials, including Miran, Musalem and Daly, but did little to spur price action. EUR/USD lacked conviction and kept within tight parameters in the absence of any notable catalysts from the bloc. GBP/USD struggled for direction after its recent choppy performance and as UK unemployment and wages data loom. USD/JPY edged higher after returning to 154.00 territory but then gave back some of the gains as risk appetite soured. Antipodeans gradually trickled lower after having outperformed yesterday on the back of the risk environment. PBoC set USD/CNY mid-point at 7.0866 vs exp. 7.1204 (Prev. 7.0856) FIXED INCOME 10yr UST futures remained subdued after demand was dampened yesterday alongside the broad risk-on environment, owing to US government reopening optimism and with price action also contained owing to the closure of the US bond market on Tuesday for Veterans Day. Bund futures faded the prior day's rebound and retested the 129.00 level to the downside heading into German ZEW data. 10yr JGB futures remained afloat and continued to nurse recent losses with some curve steepening seen following mixed results in the latest 30yr JGB auction. COMMODITIES Crude futures lacked direction following the prior day's choppy performance in the absence of energy-specific catalysts. Spot gold extended on yesterday's rally with the precious metal back above the USD 4,100/oz level. Copper futures gradually pulled back from a weekly high amid the fleeting risk appetite overnight. Codelco copper production fell 7.2% Y/Y in September to 115.6k tons and Escondida copper production rose 16.8% to 118.6k tons, while Collahuasi copper production fell 26% Y/Y to 38k tons. CRYPTO Bitcoin swung between gains and losses after failing to sustain a brief return to above the USD 107k level. US Treasury Secretary Bessent said the Treasury and the IRS have issued new guidance giving crypto ETPs a clear path to stake digital assets and share staking rewards with their retail investors. NOTABLE ASIA-PAC HEADLINES Japanese Economy Minister Kiuchi said they are aware that high inflation is weighing on private consumption, and that a weak yen pushes up prices through higher import costs. Kiuchi added they will expand and implement measures to cushion the impacts of higher prices, as well as continue to aim for wage growth exceeding inflation. DATA RECAP Australian Westpac Consumer Sentiment MM (Nov) 12.8% (Prev. -3.5%) Australian Westpac Consumer Sentiment Index (Nov) 103.8 (Prev. 92.1) Australian NAB Business Confidence (Oct) 6.0 (Prev. 7.0) Australian NAB Business Conditions (Oct) 9.0 (Prev. 8.0) New Zealand 1yr Inflation Expectation (Q4) 2.4% (Prev. 2.4%) New Zealand 2yr Inflation Expectation (Q4) 2.3% (Prev. 2.3%) GEOPOLITICS MIDDLE EAST US President Trump posted "It was an Honor to spend time with Ahmed Hussein al-Sharaa, the new President of Syria, where we discussed all the intricacies of PEACE in the Middle East, of which he is a major advocate. I look forward to meeting and speaking again. Everyone is talking about the Great Miracle that is taking place in the Middle East. Having a stable and successful Syria is very important to all countries in the Region." Turkish Foreign Minister said they discussed Syria and Gaza in talks with US and Syrian counterparts, US VP Vance, Trump aide Witkoff, and special envoy Barrack. He added that US officials understand that Syria needs to be united, and that problems in south and north Syria risk dividing the country. RUSSIA-UKRAINE Ukrainian drone attack damaged civilian infrastructure in Russia's Saratov, according to the regional governor. Russian security services reportedly foiled a joint Ukrainian-British operation to hijack a Russian MiG-31 equipped with a hypersonic missile, according to RIA. OTHER NEWS Thai Defence Minister announced the halting of ceasefire implementation steps and return of Cambodian prisoner of war, while he said they will explain to Malaysia and the US regarding the Thai decision on the ceasefire. EU/UK NOTABLE HEADLINES European Commission has begun setting up a new intelligence body under President Ursula von der Leyen, in an attempt to improve the use of information gathered by national spy agencies, according to FT. DATA RECAP Barclays UK October Consumer Spending fell 0.8% Y/Y (prev. -0.7% Y/Y in September) UK BRC Retail Sales YY (Oct) 1.5% (Prev. 2.0%) UK BRC Total Sales YY (Oct) 1.6% (Prev. 2.3%) Loading...
