Asian equities continue week's softness amid further hawkish Trump appointees

Asia market update: Asian equities continue week's softness amid further hawkish Trump appointees; US Oct PPI tonight.

General trend

- Asian stocks continued a week of soft prices amid further appointees by Pres-elect Trump that suggest a hard line will be taken on trade and solidifying stated goals of a clean break from the policies of the Biden Administration.

- Nations continued to show post-election concern for any trade surpluses they may have with the US, with the Taiwan Central Bank saying that the 2024 trade surplus with US estimated to be ~$50B, but specifically saying that investments by Taiwan Semi in the US should reduce the surplus.

- Reporting out of China said that it was preparing ‘powerful’ countermeasures for a potential trade war.

- Australia employment grew in October, but the 0.1% increase was the slowest growth in recent months.

- China PBOC set the offshore Yuan 359 pips stronger than the estimate, but it did little to stop USD/CNH holding the 7.25 handle and beyond, weakest level since Aug 2nd.

- Japan's 10-year govt bond yield followed global levels up, rising to nearly 1.056%, highest since Aug 1st, with the 30-yr yield risnig to the highest since 2010.

- Japan's political quagmire post-election continues, with a special Diet session called for Nov 28th or 29th, with the FY budget outcome still up in the air.

- US equity FUTs down slightly during the Asia session.

Looking ahead (Asian time zone)\

- Thu Nov 14th (Thu night US Oct PPI).

- Fri Nov 15th JP Q3 GDP, CN Oct ‘data dump’ (Fri eve UK Q3 prelim GDP, Fri night US Oct Retail Sales + Industrial Production).

 Holidays in Asia this week.

- Fri Nov 15th India.

Headlines/economic data

Australia/New Zealand

- ASX 200 opens +0.2% at 8,208.

- Australia Oct employment change: +15.9K V +25.0KE; unemployment rate: 4.1% V 4.1%E.

- Australia Nov Consumer Inflation Expectation Survey: 3.8% v 4.0% prior.

- Reserve Bank of Australia (RBA) Gov Bullock: Don't know what US will do; Will not jump at shadows - participates on panel.

- New Zealand Oct Food Prices M/M: -0.9% v 0.5% prior.

- New Zealand Oct REINZ House Sales Y/Y: +20% v +3.2% prior.

- New Zealand sells total NZ$500M vs. NZ$500M indicated in 2029, 2035 and 2037 bonds.

China/Hong Kong

- Hang Seng opens -1.0% at 19,626; Shanghai Composite opens -0.3% at 3,429.

- China prepares ‘powerful’ countermeasures for potential trade war with Trump; cites China advisers and international risk analysts - FT.

- China Ministry of Finance formally announces tax cuts for home buyers; Formally cuts deed tax to as low as 1%; effective Dec 1st.

- CATL: Chairman: Would build US plant if Trump permits it - financial press.

- China sells 3-year and 7-year Bonds.

- China PBOC sets Yuan reference rate: 7.1966 v 7.1991 prior.

- China PBOC Open Market Operation (OMO): Injects CNY328B in 7-day reverse repos; Net injects CNY309B v net injects CNY216B prior.

Japan

- Nikkei 225 opens +0.5% at 38,911.

- Japan releases weekly flows data [period ended Nov 8th]: Foreign buying of Japan equities: ¥513.9B v ¥153.2B prior; Japan buying of foreign bonds: +¥1.72T v -¥4.46T prior.

- Fitch: Japan New Political Dynamics May Challenge Positive Fiscal Trends.

- Japan govt considering convening an extraordinary session of the Diet on Nov 28th or 29th - Japanese press.

- Japan said to consider FY extra budget of $87.0B (¥13.5T v ¥13.0T y/y) – Japanese press.

Korea

- Kospi opens +0.5% at 2,430.

- South Korea Sept M2 Money Supply M/M: 0.2% v 0.2% prior.

- South Korea Fin Min Choi: Reiterates will take steps to stabilize FX and Financial markets if needed.

- (RU) US Sec State Blinken: Russia/North Korea relationship is working in two directions [overnight update].

Other Asia

- Taiwan Central Bank (CBC) Gov Yang Ching-Long: 2024 trade surplus with US estimated to be ~$50B - parliamentary testimony.

North America

- (US) Trump transition co-Chair Howard Lutnick said to 'make a late play' for Treasury Secretary - WSJ.

- (US) MBA Mortgage Applications w/e Nov 8th: +0.5% v -10.8% prior (1st rise in 7 weeks).

- (US) Elon Musk replies "This is the only way" to the post by Ramaswamy that "slapping the bureaucracy on the wrist won’t solve the problem, the only right answer is a massive downsizing".

- (US) Oct CPI M/M: 0.2% V 0.2%E; Y/Y: 2.6% V 2.6%E (highest annual pace since July); (ex-food/energy) M/M: 0.3% v 0.3%e; Y/Y: 3.3% v 3.3%e.

- (US) Oct Real Avg Hourly Earning Y/Y: 1.4% v 1.4% prior; Real Avg Weekly Earnings Y/Y: 1.4% v 1.1% prior.

- (US) Fed's Kashkari (non-voter for 2024 and 2025): CPI headline confirms path we're on; Have confidence inflation is headed in right direction; Labor market is softening - press interview.

- (US) Fed's Logan (non-voter): Models show that Fed funds rate could be very close to neutral; Anticipates more rate cuts, but remains uncertain as to the level of the neutral rate.

- (US) Sen John Thune (R-SD) elected Senate Majority Leader by the GOP caucus.

- (US) NBC and CNN are now projecting GOP will win a majority in the US House of Representatives (as expected).

- (US) Pres-elect Trump names additional senior officials for his Administration; Names Dan Scavino as Deputy Chief of Staff; Confirms will name Sen. Marco Rubio (R-FL) as Sec of State; Tulsi Gabbard as Director of National Intelligence (DNI); Matt Gaetz as Attorney General.

- (US) Fed's Musalem (non-voter in 2024; voter in 2025): Growth is broad based and driven by consumption, income growth, productivity, supportive financial conditions, and wealth effects.

- (US) Fed's Schmid (non-voter for 2024; voter for 2025; hawk): Won't let enthusiasm over rising productivity get ahead of data or commitment to reaching Fed's goals.

- (US) Oct monthly budget statement: -$257.5B V -$225.0BE.

Europe

- (UK) Oct RICS House Price Balance: 16% v 11%e [highest since 2021].

- (IL) Israel Oct Trade Balance: -$2.8B v -$3.2B prior.

- (PT) Portugal Oct Final CPI M/M: 0.1% v 0.1% prelim; Y/Y: 2.3% v 2.3% prelim.

- (RU) Russia energy ministry: Considers possible lifting ban on gasoline export - Russian press.

- (IR) Reportedly Iran postpones response to Israel top open negotiations with US Pres-elect Trump after warning message it received via Iraq - Sky Arabia.

- (DE) German Chancellor Scholz confirms to hold snap elections on Feb 23rd 2025; We can agree to legislate to tackle fiscal drag before the election.

- (FR) French Pres Macron: EU must synchronize financial regulation with US.

- (DE) Reportedly German debt brake will not be changed for now - press.

Levels as of 01:20 ET

- Nikkei 225 -0.2%, ASX 200 +0.4%, Hang Seng -1.4%; Shanghai Composite -0.7%; Kospi -0.1%.

- Equity S&P500 Futures -0.1%; Nasdaq100 -0.2%; Dax -0.3%; FTSE100 -0.1%.

- EUR 1.0534-1.0568; JPY 154.34 -156.15; AUD 0.6460-0.6498; NZD 0.5854-0.5885.

- Gold -0.9% at $2,564/oz; Crude Oil -0.5% at $68.09/brl; Copper -1.0% at $4.0307/lb.