Quiet start to a shortened trading week
Remarks / Observations
- The start of quiet trading shortens Thanksgiving week.
- Awaiting Biden’s announcement of Fed chairmanship.
- The policy differences between the Fed and the ECB and the BOJ remain at the center of concerns.
- Self-discipline mechanism of the Chinese foreign exchange market [PBOC led group] said commenting on domestic banks own account trading, said asking banks to cap the size of foreign exchange related own account trading accounts.
- China’s PBoC monthly lending rate-fixing transaction left 1-year and 5-year rates unchanged for the 19th consecutive month of stable rates.
- German government officials have said they are debating the need to make vaccinations mandatory. Several members of Chancellor Merkel’s conservative bloc said federal and state governments should introduce them soon
- The Netherlands saw a second night of riots as people took to the streets to protest the new lockdown rules.
- EU plans to increase restrictions on banks’ use of cross-border authorizations [method used by non Euro Zone banks to sell certain activities in the EU].
- Brexit in UK Min Frost confirmed that talks with the EU’s Sefcovic will continue until the week of November 22; The discussions were intense and constructive. So far, the solutions provided by the EU do not solve the problems. We need more ambition and more urgency if we are to support the peace process and protect the Good Friday Agreement.
- France President Macron: The negotiations on fishing and Brexit are advancing too slowly and without enough firmness.
- BOE Governor Bailey reiterated his position that if the economy evolves as the forecasts and reports suggest, we will have to raise rates. It is not the bank’s job to solve the supply chain issues that are hampering economies around the world, resulting in rising inflation.
- US President Biden said he was ready to make an announcement about the Fed’s chairmanship ahead of his departure for his vacation trip on Tuesday evening. November 23.
- Oil prices are falling as reports of the coordinated release of reserves rise (Japan has said it is preparing to sell oil reserves as the current level of supply is deemed excessive).
Speakers / Fixed income / FX / Commodities / Erratum
- Indices [Stoxx600 +0.19% at 487.02, FTSE +0.26% at 7,242.11, DAX +0.03% at 16,165.25, CAC-40 +0.21% at 7,127.12, IBEX-35 +0.58% at 8,803.95, FTSE MIB -0.11% at 27,307.00 , SMI +0.06% at 12,552.10, S&P 500 Futures +0.34%].
Market focal points / Key themes:
- European indices opened slightly higher Monday morning; the sector among those outperforming the others is the telecommunications sector on the potential acquisition of Telecom Italia by KKR, which is trading at more than 20%; while declining sectors include real estate and materials; UK retailer Marks and Spencer is trading up 3% in London following speculation over the weekend over Apollo acquisition interest; Ericsson announces the acquisition of US-based Vonage Holdings in a $ 6.2 billion deal and is trading down 4%; Frontier Developments stock trading fell sharply following the trade update and weaker outlook; the benefits of the next session in the US include Twist Biosciences and Spire.
- Consumer discretionary: Marks & Spencer [MKS.UK] + 3% (Apollo interest).
- Finances: Julius Baer [BAER.CH] -3% (trading update).
- Materials: Mines Hochschild [HOC.UK] -48% (response to events in Peru).
- Real estate: Vonovia [VNA.DE] -1% (capital increase).
- Technology: – Border developments [FDEV.UK] -31% (trading update; outlook lowered).
- Telecom: Telecom Italia [TIT.IT] + 22%, Vivendi [VIV.FR] + 3% (KKR offer for Telecom Italia), Ericsson [ERICB.SE] -4% (acquires Vonage Holdings).
- The ECB noted that the banking sector was not close to meeting expectations on climate risk.
- Germany’s new government has said it includes FDP leader Lindner as finance minister and Habeck as economy minister.
- The new ruling parties in Romania have agreed on the prime minister.
Currency / Fixed Income
- The USD maintained its firm tone on the perception of a divergence in central bank policies.
- EUR / USD below the 1.1280 area as the pair softened over concerns about the economic impact of renewed restrictions in Europe to contain rising coronavirus cases.
- China has announced that it wants to limit speculation by financial institutions on the yuan. Dealers note that Chinese policymakers appeared to be increasingly uncomfortable with the recent rally in the CNY (Yuan) currency.
- (NL) Netherlands Nov Consumer confidence: -19 vs. -10 before.
- (DK) Denmark Nov. Consumer confidence indicator: -2.0 against +3.3 previously.
- (TR) Turkey Nov. Consumer confidence: 71.1 vs. 76.8 previously.
- (MY) Malaysia’s foreign reserves as of mid-November: $ 116.5 billion versus $ 116.1 billion previously.
- (CH) Swiss M3 money supply in Oct. Y / Y: 2.5% vs. 3.3% previously.
- (TR) Turkey Oct. Arrivals of foreign tourists Y / Y: 99.3% against 59.5% previously.
- (TW) Taiwan Oct Export Orders Y / Y: 14.6% vs. 22.9% e (20th consecutive month of growth).
- (TW) Unemployment rate in Taiwan in October: 3.8% vs. 3.8% e.
- (HK) Hong Kong Oct CPI Composite Y / Y: 1.7% vs. 1.8% e.
- (ES) Spain’s trade balance in September: -2.4B â¬ against -3.9B â¬ previously.
- (CH) Total Swiss weekly sight deposits (CHF): 719.3B against 719.2B previously; National sight deposits: 646.7 billion against 644.1 billion previously.
- (PL) Poland Oct. Sold Industrial production M / M: + 2.3% v -0.5% e; Y / Y: 7.8% vs. 5.3% e.
- (PL) Poland Oct Construction Production Y / Y:% v 3.4% e.
- (PL) Poland Oct PPI M / M: 1.8% vs. 1.3% e; Y / Y: 11.8% vs. 11.0% e.
- (BE) Belgium Nov Consumer confidence index: 1 against 4 before.
Issue of fixed income securities
- (AR) Argentina October Budget Balance (ARS): No earlier version than 291.4B.
- (MX) Citibanamex survey of economists.
- (CO) Colombia Oct Industrial Trust: No est v 20.4 before; Confidence in the retail trade: no is v 40.3 a priori.
- 5:25 am (EU) ECB daily liquidity statistics.
- 5:30 a.m. ((DE) Germany to sell 3.0 billion euros in 12-month BuBills; Average yield:% v -0.7424% before; Bid-to-cover: xv 2.70x before (November 15, 2021 ).
- 06:00 (IE) Ireland Oct PPI M / M: No est v 0.0% before; Y / Y: No is v -1.9% before.
- 06:00 (IL) Israel Sep Manufacturing production M / M: No is v -2.4% before.
- 06:00 (IL) Israel Oct Unemployment rate: No is v 5.2% before; Unemployment rate (including the Covid effect): none is against 7.9% before.
- 06:00 (DE) The Belgian Debt Agency (BDA) will sell 2.4 to 3.2 billion euros of OLO 2031, 2040 and 2071 bonds.
- 06:00 (RO) Romania sells 2027 and 2036 bonds.
- 06:00 (IL) Israel will sell 2024, 2026, 2032, 2051 bonds (5 tranches).
- 06:25 (BR) Weekly survey of economists at the Central Bank of Brazil.
- 6:30 a.m. (EU) The European Commission sells bonds.
- 6:45 am (US) Correction of the daily Libor.
- 07:00 (IN) India announces details of upcoming bond sale (held on Friday).
- 07:00 (TR) Turkey will sell fixed rate bonds.
- 08:00 (UK) Daily Baltic Dry Bulk Index.
- 8:30 am (United States) Oct. Chicago Fed National Activity Index: + 0.10ev -0.13 before.
- 9 a.m. (FR) The French Debt Agency (AFT) will sell â¬ 4.4 to 5.6 billion in 3-month, 6-month and 12-month bonds.
- 9:00 a.m. (IL) Central Bank of Israel (BOI) decision on interest rate: should leave base rate unchanged at 0.10%.
- 09:00 (AT) Holzmann (Austria) of the ECB with members, Kazaks (Latvia), Kazimir (Slovakia), Czech central bank Gov Rusnok in Vienna.
- 9.45am (UK) BOE buys Â£ 1.47bn in a deal to buy Gilt APF (3-7 years).
- 10:00 am (United States) Oct. Existing home sales: 6.18MB vs. 6.29M before.
- 10:00 am (EU) Euro Zone Nov Advance Consumer Confidence: -5.3ev -4.8 before.
- 12:30 p.m. (ES) De Guindos of the ECB (Spain).
- 16:00 (KR) South Korea Nov Consumer confidence: no est v 106.8 before.
- 4:45 p.m. (NZ) Q3 retail sales in New Zealand T / T: -10.5% ev + 3.3% before.
- 17:00 (AU) Australia Nov Preliminary PMI Manufacturing: No est v 58.2 earlier; PMI Services: No earlier version than 51.8; Composite PMI: No earlier version than 52.1.
- 5:30 PM (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: Not v 106.0 before.
- 18:01 (NL) Netherlands Oct. Real Estate Price Index M / M: Not estimated vs. 1.6% before; Y / Y: No is v 18.5% before.
- 8:05 PM (AU) Kohler from RBA in a virtual conference.
- 9:30 p.m. (KR) South Korea will sell KRW400B in 20-year bonds.
- 10 p.m. (TH) The Central Bank of Thailand will sell THB 50 billion in 3-month notes.
- 10:30 p.m. (HK) Hong Kong to sell 3-month, 6-month and 12-month coupons.
- 10:30 p.m. (TH) Thailand Oct. Customs trade balance: 0.1 Be against 0.6 billion dollars previously; Y / Y exports: 16.5% ev 17.1% before; Y / Y imports: 29.6% ev 30.3% a priori.