Choppy US trade while the yield curve flattens and oil tumbles – Newsquawk Asia-Pac Market Open – US stocks sold off to start the session with the Russell leading the losses with the SPX, NDX and DJIA initially following suit.- The Dollar was flat on Wednesday with DXY trading between 105.44 and 105.87 with the downside in stocks and yields keeping the buck balanced.- Treasuries bull-flattened Wednesday as oil prices continued to tumble after a relatively okay US 10-year auction.- Oil prices continued to fall on Tuesday as global demand woes took centre stage with some bearish US energy inventory data.- Looking ahead, highlights include Fed’s Jefferson, BoJ SOO, UK RICS Housing survey Chinese Inflation, and 30-year JGB Auction.More Newsquawk in 2 steps: 1.Subscribe to the free [premarket movers](https://newsquawk.com/?utm_source=zerohedge&utm_medium=research&utm_campaign=partner-post&utm_content=asia-pac-opening) reports 2.Trial Newsquawk’s premium real-time audio news [squawk box](https://newsquawk.com/pricing?utm_source=zerohedge&utm_medium=research&utm_campaign=partner-post&utm_content=asia-pac-opening) for 7 days 9th November 2023 – Click [here](https://newsquawk.com/headlines/week-ahead-highlights-include-china-trade-and-inflation-rba-boc-minutes-banxico-norway-cpi-uk-gdp-03-11-2023)for the Newsquawk Week Ahead.
US TRADE – US stocks sold off to start the session with the Russell leading the losses with the SPX, NDX and DJIA initially following suit.However, once Europe had finished for the day equity futures ground higher again to see a broadly unchanged close, aside from the small caps – RUT closed lower by over 1% with regional banks also underperforming while the lower oil prices also weighed on the energy names.- SPX +0.10% at 4,382, NDX +0.11% at 15,313, DJIA -0.12% at 34,112, RUT -1.10% at 1,714.- Click [here](https://newsquawk.com/headlines/newsquawk-us-market-wrap-stocks-chop-yield-curve-flattens-and-oil-tumbles-08-11-2023)for a detailed summary.
NOTABLE HEADLINES – BoC Minutes: Some members of the GC felt the rate would more likely than not need to increase further.Other council members felt a 5% rate would be likely be enough to bring inflation down to the 2% target provided it was maintained at that level for long enough, and there was a strong consensus that with clearer evidence of higher rates having the desired effect, GC should be patient and hold policy rate at 5%.
Click [here](https://newsquawk.com/headlines/boc-minutes-some-members-of-the-gc-felt-the-rate-would-more-likely-than-not-need-to-increase-further-08-11-2023)for more details.- Bank of America (BAC) CEO Moynihan said the research team is predicting a soft landing of the US economy and consumer spending has slowed, according to Reuters.- Fed Chair Powell did not comment on monetary policy or the economic outlook in prepared remarks.- Fed’s Cook (Neutral, Voter) said persistent inflationary pressures and unexpected policy rate increases abroad are among risks to the global financial system, according to Reuters.
– US SEC has reportedly opened talks with Grayscale Investments on the details of the company’s application to convert its trust product GBTC to a spot bitcoin (BTC) ETF, according to CoinDesk citing sources.DATA RECAP – Atlanta Fed GDPnow (Q4): 2.1% (prev.
2.1%).
– US Wholesale Sales MM * (Sep) 2.2% vs.Exp.0.8% (Prev.
1.8%, Rev.2.0%) – US Wholesale Invt(y), R MM * (Sep) 0.2% – US Mortgage Refinance Index w/e 347.3 (Prev.341.7) – US MBA Purchase Index w/e 129.0 (Prev.125.2) – US Mortgage Market Index w/e 165.9 (Prev.161.8) – US MBA Mortgage Applications w/e 2.5% (Prev.-2.1%) – US MBA 30-Yr Mortgage Rate w/e 7.61% (Prev.7.86%) FX – The Dollar was flat on Wednesday with DXY trading between 105.44 and 105.87 with the downside in stocks and yields keeping the buck balanced.- The Euro was also flat on Wednesday, trading either side of 1.0700 between 1.0660 and 1.0716 parameters.
The EU saw the latest Retail Sales data for – September which declined 0.3% M/M and 2.9% Y/Y, adding to fears of a recession within the Eurozone.- The Yen was softer vs the buck with USD/JPY rising above 151 to a high of 151.05, breaching the 2nd Nov.high of 150.96, with technicians eyeing the double top around 151.70/74 with the BoJ Summary of Opinions for their latest meeting scheduled for after hours.- Cyclical currencies were weaker with underperformance in the Antipodes, particularly the Aussie after the RBA’s dovish hike on Tuesday with the afternoon weakness in equities keeping the Aussie weighed on.FIXED INCOME – Treasuries bull-flattened Wednesday as oil prices continued to tumble after a relatively ok US 10-year auction.- US sells USD 40bln of 10yr notes at 4.519%; tails by 0.8bps COMMODITIES – Oil prices continued to fall on Tuesday as global demand woes take centre stage with some bearish US energy inventory data.- Iraqi government oil officials met with Kurdistan reps to discuss resumption of flows from an export pipeline from Iraq to Turkey, according to Reuters citing the statement.- EIA Petroleum Release: The EIA is conducting a systems upgrade, as such November 8th-10th data will be released from November 13th.
GEOPOLITICAL – US President Biden and Chinese President Xi reportedly prepare to restart military-to-military channels, according to Axios citing sources.- Egyptian sources said they are close to reaching a humanitarian truce in the Gaza Strip to exchange detainees, according to Sky News Arabia.ASIA-PAC NOTABLE HEADLINES – Japan’s Government will seek JPY 2tln (USD 13.2bln) in budget funding to support chip production and advances in generative AI technology, including more aid for Taiwan Semiconductor Manufacturing Co.(TSM), according to Nikkei.- Two of Japan’s biggest life insurers, Nippon Life Insurance and Dai-ichi Life Insurance, are increasing their purchases of superlong-term Japanese government bonds in the second half of FY23, according to Nikkei.- Houthis in Yemen claim to have shot down a US MQ9 Reaper drone, according to Reuters.EU/UK NOTABLE HEADLINES – ECB’s Nagel (Hawk) said PEPP could play a role in bringing liquidity down, open to the discussion, according to Reuters.He said a discussion on when rates can be cut is not helpful, it is much, much too early – ECB’s Makhlouf said we are living in uncertain times and let’s keep all options on the table and not rule things out prematurely, according to Reuters.
– UK’S MHRA authorises Eli Lilly’s (LLY) diabetes drug Mounjaro (Tirzepatide) for obese adult patients to aid with help loss and weight management, according to Reuters.GLOBAL – Polish NBP Base Rate (Nov) 5.75% vs.Exp.5.50% (Prev.5.75%)..
