US markets technically return from Thanksgiving but volume indicates a long-weekend for most

EU Mid-Market Update: US markets technically return from Thanksgiving but volume indicates a long-weekend for most; Data driven EU session fails to move needles ahead of S&P decision on France.

Notes/observations

- Heavy slew of economic data from Europe keeps market participants on toes while corporate and geopolitical news flow is light. US returns from Thanksgiving holiday. US cash trading to close early at 13:00 ET.

- German retail sales were mixed, and unemployment was better than expected; French CPI was cooler than estimated but still above prior month and highest since Aug, GDP was revised lower; Swiss and Sweden GDP beat consensus.

- US stocks yet to react to headlines of last few days, such as more market speculation of additional China stimulus by year-end and press report that US readies China chip curbs that stop short of early proposals.

- France not of the woods with budget after far-right leader Le Pen noted there are still concerns with the budget despite Fin Min making concessions. Spread with German 10-year ~83bps and remains within Greek 10-year; Key upcoming dates to watch for France: today, Nov 29th (S&P decision on France sovereign rating; S&P has already cut France one notch at 'AA-' from 'AA' in May 2024), then during Dec 2-4th is the first hurdle (vote on the Social Security budget (PLFSS) could occur) before Dec 21st's deadline for PM Barnier’s minority government to pass next year’s budget. No confidence vote could happen as soon as next week.

- Coffee running hot with ICE Arabica Coffee Futures at 47-year highs and ICE Robusta Coffee futures at highest since contract started trading.

- Asia closed mixed with KOSPI underperforming -2.0%. EU indices are marginally lower -0.1%. US futures are +0.3-0.4%. Gold +1.0%, DXY -0.2%; Commodity: Brent -0.7%, WTI -0.4%; Crypto: BTC +1.9%, ETH -0.7%.

Asia

- Japan Nov Tokyo CPI Y/Y: 2.6% v 2.2%e; CPI (ex-fresh food) Y/Y: 2.2% v 2.0%e.

- Japan Oct Jobless Rate: 2.5% v 2.5%e.

- Japan Oct Retail Sales M/M: 0.1% v 0.4%e; Y/Y: 1.6% v 2.0%e.

- Japan Oct Preliminary Industrial Production M/M: 3.0% v 4.0%e; Y/Y: 1.6% v 2.0%e.

- South Korea Oct Industrial Production M/M: 0.0% v 0.2%e; Y/Y: 6.3% v 2.0%e.

- Australia Oct Private Sector Credit M/M: 0.6% v 0.5%e; Y/Y: 6.1% v 5.8% prior.

- New Zealand Nov ANZ Consumer Confidence: 99.8 v 91.2 prior.

- Australia Senate passes bill to overhaul Reserve Bank board. To split the board into two expert panels; one for governance and one for interest rates. Green Party (opposition) successful in a bid to keep the rules allowing the treasurer to overrule the RBA’s decisions.

Global conflict/tensions

- Russia Pres Putin commented that If Ukraine became a nuclear power, Russia would use all means of destruction (**Note: Putin threatened to use Russia’s new ballistic missile to turn targets in Kyiv “to dust”)

Europe

- French far-right leader Le Pen stated that still had difficulties with budget; Maintained intention to vote for censure of the govt as early as next week in the event Article 49.3 invoked [**Note: Dec 2-4th is the first hurdle to pass 2025 budget with vote on the Social Security budget (PLFSS) could occur]. **Note: PM Barnier could face a no-confidence vote as early as next week. Recently PM Barnier made a major concession to Marine Le Pen’s far-right party by abandoning a plan to raise electricity taxes).

- UK Chancellor of the Exchequer (Fin Min) Reeves said to have pushed back the timing of the Treasury’s multiyear spending review to June from April.

Americas

- US Online sales for the first half of the Thanksgiving holiday up ~4% y/y [v +2% in 2023].

- Pres Biden commented that he hoped Pres-Elect Trump would rethink tariffs on Mexico and Canada; Measures were counterproductive (**Reminder: On Nov 25th, Pres-elect Trump posted on social media that he would on his first day in office charge Mexico and Canada 25% tariffs on all products coming into the US; Would also charge China "an additional" 10% tariff).

- Mexico Econ Min Ebrard stated that tariffs would impact US automakers; Predicted the proposed tariffs would result in 400K job losses in the US.

- Canada Alberta Premier: Region to work with Canada's Federal authorities on US border.

Energy

- OPEC+ delayed its online meeting from Dec 1st to Dec 5th.

- IAEA report on Iran: Informed that Iran intends to feed uranium feedstock into the eight IR-6 centrifuge cascades recently installed at Fordow to enrich to up to 5% purity.

Speakers/fixed income/FX/commodities/erratum

Equities

Indices [Stoxx600 +0.01% at 507.34, FTSE -0.05% at 8,276.91, DAX +0.02% at 19,427.25, CAC-40 +0.09% at 7,185.65, IBEX-35 -0.34% at 11,579.20, FTSE MIB -0.24% at 33,180.00, SMI +0.20% at 11,721.15, S&P 500 Futures +0.30%].

Market focal points/key themes: European indices open modestly lower and failed to gain traction through the early part of the session; markets seen hesitant ahead of a large number of data releases including CPI for the EuroArea; among sector managing gains are real estate and materials; sectors inclined to the downside include consumer discretionary and health care; ABC Technologies to acquire Ti Fuild Systems; Repsol sells to assets in Colombia to GeoPark; Delivery Hero sets IPO price for Talabat at SED1.60/shr; Norma starts sale process of its Water Management unit; shortened US trading session with no major earnings expected.

Equities

- Consumer discretionary: Carrefour [CA.FR] -0.5% (Brazil exposure amid budget deficit worries there).

- Financials: Euronext [ENX.FR] -2.0% (HSBC cuts to hold), Aegon [AGN.NL] +2.0% (tier1 firm raised to buy).

- Industrials: Norma Group [NOEJ.DE] +17.0% (initiates divestment process for Water Management business), TI Fluid Systems [TIFS.UK] +2.0% (confirms offer to be acquired), Volkswagen [VOW3.DE] -0.5% (IG Metall union confirms strikes at Volkswagen start from early Dec), Thyssenkrupp [TKA.DE] +0.5% (German Defence Ministry orders 4 submarines for €4.7B), Kion [KGX.DE] +3.0% (Tier1 firm raised to buy), Elia [ELI.BE] +1.5% (raises FY24 profit and ROE guidance in trading update).

- Materials: Anglo American [AAL.UK] +3.0% (Jefferies raised to buy).

Speakers:

- ECB's Stournaras (Greece) commented that trade tariffs could warrant aggressive rate cuts.

- Bank of England releases stress test results confirmed its resilience of each UK central counterparty (CCP) to a stress scenario similar to the worst-ever historical stress.

- Hungary PM Orban nominated Fin Min Varga as next Central Bank Gov, who accepted nomination; To overhaul economic leadership in Jan 2025.

- Japan Fin Min Kato stated that was important to continue with spending reform efforts pointing out that Japan Domestic debt to GDP ratio was world's highest.

Currencies/fixed income

- USD ending the week with its worst performance since Trump won the Presidential election bank on Nov 5th. The greenback still has appreciated by around 2% on average against the other G-10 currencies since the election.

- EUR/USD probe the 1.06 area earlier in the session as more EU inflation data showed an uptick in the Nov readings. Nonetheless markets still prediction another rate cut by the ECB at the upcoming Dec Council meeting. Recent ECB rhetoric and data had dialed back expectations of any 50bps cut.

- USD/JPY tested one-month lows and hovered around the 150-area\ following hotter Tokyo Nov Core CPI reading which kept the radar on alert for a potential Dec BOJ rate hike. Currently markets forecast a 60% chance that BOJ would pull the trigger and hike at its next meeting.

Economic data

- (NL) Netherlands Nov Preliminary CPI Y/Y: 4.0% v 4.0%e; CPI EU Harmonized M/M: -1.0% v -1.1%e; Y/Y: 3.8% v 3.7%e.

- (FI) Finland Q3 GDP Q/Q: 0.3% v 0.1% prior; Y/Y: +0.5% v -1.5% prior.

- (FI) Finland Oct Retail Sales Volume Y/Y: -2.9% v -3.1% prior.

- (ZA) South Africa Oct M3 Money Supply Y/Y: 7.9% v 7.3% prior; Private Sector Credit Y/Y: 4.3% v 4.8%e.

- (DE) Germany Oct Retail Sales M/M: -1.5% v -0.5%e; Y/Y: 3.6% v 3.3%e.

- (DE) Germany Oct Import Price Index M/M: 0.6% v 0.2%e; Y/Y: -0.8% v -1.2%e.

- (SE) Sweden Q3 GDP Q/Q: +0.3% v -0.1%e; Y/Y: 0.7% v 0.3%e.

- (SE) Sweden Oct Retail Sales M/M: 0.4% v 0.0% prior; Y/Y: 0.9% v 2.1% prior.

- (SE) Sweden Sept Non-Manual Workers’ Wages Y/Y: 4.4% v 4.3% prior.

- (NO) Norway Oct Retail Sales (ex-auto) M/M: +0.2% v -0.3% prior.

- (NO) Norway Nov Unemployment Rate: 2.0% v 1.9% prior; Unemployment Rate Seasonally adj): 2.1% v 2.1%e.

- (TR) Turkey Q3 GDP Q/Q: -0.2% v -0.2%e; Y/Y: 2.1% v 2.5%e.

- (DK) Denmark Oct Unemployment Rate: 2.6% v 2.6% prior; Gross Unemployment Rate: 2.9% v 2.9% prior.

- (TH) Thailand Oct Current Account Balance: $0.7B v $0.6Be; Overall Balance of Payments (BoP): -0.3$B v +$2.4B prior; Trade Account Balance: $1,4B v $2.5B prior; Exports Y/Y: 14.2% v 1.1% prior; Imports Y/Y: 17.1% v 9.5% prior.

- (HU) Hungary Oct Unemployment Rate: 4.5% v 4.5%e.

- (HU) Hungary Oct PPI M/M: +1.0% v -0.4% prior; Y/Y: 2.6% v 0.9% prior.

- (CN) Weekly Shanghai Copper Inventories (SHFE): 108.8K v 120.2K tons prior.

- (TH) Thailand May Foreign Reserves w/e Nov 22nd: $234.6B v $234.0B prior.

- (FR) France Q3 Final GDP Q/Q: 0.4% v 0.4% prelim; Y/Y: 1.2% v 1.3% prelim.

- (FR) France Nov Preliminary CPI M/M: -0.1% v 0.0%e; Y/Y: 1.3% v 1.4%e.

- (FR) France Nov Preliminary CPI EU Harmonized M/M: -0.1% v 0.0%e; Y/Y: 1.7% v 1.8%e.

- (FR) France Q3 Final Private Sector Payrolls Q/Q: +0.1% v -0.1% prelim; Total Payrolls: +0.2% v -0.1% prior.

- (FR) France Oct Consumer Spending M/M: -0.4% v 0.0%e; Y/Y: +0.4% v -0.1% prior.

- (FR) France Oct PPI M/M: +0.9% v -0.1% prior; Y/Y: -5.7% v -6.9% prior.

- (CH) Swiss Q3 GDP Q/Q: 0.4% v 0.4%e; Y/Y: 2.0% v 1.8%e ; GDP (Sports Adj) Q/Q: 0.2% v 0.2% prelim.

- (CH) Swiss Nov KOF Leading Indicator: 101.8 v 100.0e.

- (ES) Spain Oct Advance Retail Sales Y/Y: 3.5% v 3.7%e v 4.2% prior; Retail Sales (unadj) Y/Y: 5.4% v 1.8% prior.

- (AT) Austria Nov Preliminary CPI M/M: 0.3% v 0.3% prior; Y/Y: 1.9% v 1.8% prior.

- (AT) Austria Oct PPI M/M: +0.3% v -0.2% prior; Y/Y: -2.3% v -2.6% prior.

- (CZ) Czech Q3 Preliminary GDP (2nd of 3 readings) Q/Q: 0.4% v 0.3% advance; Y/Y: 1.3% v 1.3% advance.

- (RU) Russia Narrow Money Supply w/e Nov 22nd (RUB): 18.27T v 18.34T prior.

- (TW) Taiwan Q3 Preliminary GDP (2nd of 3 readings) Y/Y: 4.2% v 4.0% advance.

- (HK) Hong Kong Oct Retail Sales Volume Y/Y: -4.9% v -7.7%e; Retail Sales Value Y/Y: -2.9% v -5.5%e.

- (HK) Hong Kong Oct M3 Money Supply Y/Y: 3.7% v 3.0% prior; M2 Money Supply Y/Y: 3.7% v 3.0% prior; M1 Money Supply Y/Y: 3.4% v 3.2% prior.

- (DE) Germany Nov Unemployment Change: +7.0K v +20.0Ke; Unemployment Claims rate: 6.1% v 6.1%e.

- (EU) Euro Zone Oct ECB CPI Expectations Survey: 1-year ahead: 2.5% v 2.3%e; 3-year ahead: 2.1% v 2.1%e.

- (ES) Spain Sept Current Account Balance: €4.1B v €5.6B prior.

- (IT) Italy Sept Industrial Sales M/M: -0.3% v -0.3% prior; Y/Y: -5.7% v -4.9% prior.

- (NO) Norway Central Bank (Norges) Dec Daily FX Purchases: 150M v 150M prior.

- (IS) Iceland Q3 GDP Q/Q: -1.1% v +1.5% prior; Y/Y: -0.5% v +0.2% prior.

- (CZ) Czech Oct M2 Money Supply Y/Y: 6.0% v 5.4% prior.

- (PL) Poland Nov Preliminary CPI M/M: 0.4% v 0.4%e; Y/Y: 4.6% v 4.6%e.

- (UK) Oct Net Consumer Credit: £1.1B v £1.3Be; Net Lending: £3.4B v £2.7Be.

- (UK) Oct Mortgage Approvals: 68.3K v 64.5Ke.

- (UK) Oct M4 Money Supply M/M: -0.1% v +0.5% prior; Y/Y: 3.0% v 3.5% prior; M4 (ex-IOFCs) 3-month Annualized: 4.0% v 2.6% prior.

- (PT) Portugal Nov Preliminary CPI M/M: -0.2% v +0.1% prior; Y/Y: 2.5% v 2.3% prior.

- (PT) Portugal Nov Preliminary CPI EU Harmonized M/M: -1.0% v -0.4% prior; Y/Y: 2.7% v 2.6% prior.

- (EU) Euro Zone Nov Advance CPI Estimate Y/Y: 2.3% v 2.3%e; Core CPI Y/Y: 2.7% v 2.8%e.

- (IT) Italy Nov Preliminary CPI M/M: 0.0% v -0.1%e; Y/Y: 1.4% v 1.4%e.

- (IT) Italy Nov Preliminary CPI EU Harmonized M/M: 0.0% v -0.2%e; Y/Y: 1.6% v 1.4%e.

- (BE) Belgium Q3 Final GDP Q/Q: 0.3% v 0.2% prelim; Y/Y: 1.2% v 1.0% prelim.

- (GR) Greece Oct Unemployment Rate: 9.8% v 9.4% prior.

- (GR) Greece Sept Retail Sales Value Y/Y: -0.6% v -5.1% prior; Retail Sales Volume Y/Y: % v -1.7% prior.

- (GR) Greece Oct PPI Y/Y: -2.3% v v -4.5% prior.

Fixed income issuance

- (IN) India sold total INR300B vs. INR300B indicated in 2031, 2034 and 2064 bonds (**Note: Auction saw its 1st devlovement (purchase by underwriters) since Feb 17th 2023.

Looking ahead

- (MX) Mexico Oct Public Balance (MXP): No est v -744.2B prior.

- 05:25 (EU) Daily ECB Liquidity Stats.

- 05:30 (UK) BOE financial stability review and FPC minutes.

- 05:30 (IN) India Q3 GDP Y/Y: 6.5%e v 6.7% prior; GVA Y/Y: 6.3%e v 6.8% prior.

- 05:30 (IN) India Oct Fiscal Deficit (INR): No est v 4.745T prior.

- 06:00 (PT) Portugal Q3 Final GDP Q/Q: 0.2%e v 0.2% prelim; Y/Y: 1.9%e v 1.9% prelim.

- 06:00 (PT) Portugal Oct Retail Sales M/M: No est v -0.2% prior; Y/Y: No est v 4.8% prior.

- 06:00 (UK) DMO to sell £5.5B in 1-month, 3-month and 6-month bills (£1.0B, £2.0B and £2.5B respectively).

- 06:30 (IN) India Oct Eight Infrastructure (key) Industries Y/Y: No est v 2.0% prior.

- 06:30 (BR) Brazil Oct Nominal Budget (Overall) Balance (BRL): -50.1Be v -53.8B prior; Primary Budget Balance: +40.1Be v -7.3B prior; Net Debt to GDP: 62.4%e v 62.4% prior.

- 06:30 (IN) India Forex Reserve w/e Nov 22nd: No est v $657.9B prior.

- 06:30 (ES) ECB’s De Guindos (Spain).

- 07:00 (ZA) South Africa Oct Trade Balance (ZAR): 3.3Be v 12.8B prior.

- 07:00 (ZA) South Africa Oct Monthly Budget Balance (ZAR): No est v -4.4B prior.

- 07:00 (BR) Brazil Oct National Unemployment Rate: 6.2%e v 6.4% prior.

- 07:00 (CL) Chile Oct Unemployment Rate: 8.6%e v 8.7% prior.

- 07:00 (CL) Chile Oct Retail Sales Y/Y: 3.0%e v 3.9% prior; Commercial Activity Y/Y: No est v 3.2% prior.

- 07:00 (CL) Chile Oct Industrial Production Y/Y: 1.9%e v -0.3% prior; Manufacturing Production Y/Y: +2.8%e v -1.1% prior; Total Copper Production: No est v 478.0K tons prior.

- 08:00 (UK) Daily Baltic Dry Bulk Index.

- 08:00 (DE) ECB’s Nagel (Germany).

- 08:00 (ES) Spain Debt Agency (Tesoro) announcements on upcoming issuance (held on Thurs).

- 08:00 (IN) India announces upcoming bill issuance (held on Wed).

- 08:30 (CA) Canada Sept GDP M/M: 0.3%e v 0.0% prior; Y/Y: 1.6%e v 1.3% prior; Q3 Quarterly GDP Annualized: 1.1%e v 2.1% prior.

- 10:00 (MX) Mexico Oct Net Outstanding Loans (MXN): No est v 6.56T prior.

- 10:00 (CO) Colombia Oct National Unemployment Rate: No est v 9.1% prior; Urban Unemployment Rate: 8.9%e v 9.2% prior.

- 11:00 (EU) Potential sovereign ratings after European close (S&P on France; Moody’s on Hungary).

- 13:30 (BR) Brazil Oct Total Federal Debt (BRL): 7.00Te v 6.948T prior.

Weekend

- 20:30 (CN) China Nov Manufacturing PMI (Govt Official): 50.2e v 50.1 prior; Non-Manufacturing PMI: 50.4e v 50.2 prior; Composite PMI: No est v 50.8 prior.

- 19:00 (KR) South Korea Nov Trade Balance: $4.9Be v $3.2B prior; Exports Y/Y: 2.8%e v 4.6% prior; Imports Y/Y: -0.9%e v +1.7% prior.