Asia Market Update: Big equity losses seen in Asia, travel-sensitive assets drop amid focus on new COVID variant; Safe haven currencies rise, gov’t bond yields and oil drop.

General trend

- Commodity currencies decline on the lower oil and iron ore prices; ZAR drops over 1%; Gold FUTs rise.

- Equity markets have generally extended declines.

- US equity FUTs reversed gain, DOW FUTs lag; US markets to return from holiday.

- Nikkei has declined by over 2.8%; Stronger yen weighs on automakers, Softbank Group declines amid the DiDi news.

- Hang Seng has lost over 2%; Tencent drops amid continued regulatory concerns; Casino names drop after China/HK meeting on travel; Meituan is due to report results after the market close.

- Property indices decline in Shanghai and HK; Fantasia and Evergrande have been in focus.

- Shanghai Composite traded modestly lower during the morning session (-0.5%).

- Australian Energy, Financial and Resources indices lag; travel names also drop.

- WHO is due to meet on the new COVID variant.

Headlines/Economic Data

Australia/New Zealand

-ASX 200 opened -0.1%.

- (NZ) Reserve Bank of New Zealand (RBNZ) Hawkesby: Affirms need to continue removing stimulus; sees risk inflation expectations could lift, inflation expectations will be key for the RBNZ.

- (NZ) RBNZ Gov Orr to speak at Bank of Canada conference on Nov 30th (Tuesday).

- (NZ) New Zealand Nov ANZ Consumer Confidence: 96.6 v 98.0 prior; M/M: -1.4% v -6.2% prior.

- (AU) Australia APRA Finalizes guidance on financial risks on climate change; No new regulations or requirements are being instituted.

- (AU) Australia sells A$1.5B v A$1.5B indicated in 0.25% Nov 2025 bonds, Avg Yield: 1.3087%, bid-to-cover 2.46x.

- (AU) Australia Oct Retail Sales M/M: 4.9% v 2.2%e.

Japan

-Nikkei 225 opened -0.6%.

- (JP) Japan Nov Tokyo CPI Y/Y: 0.5% V 0.4%E; CPI (Ex-Fresh Food) Y/Y: 0.3% V 0.3%E (Fastest increase since July 2020).

- (JP) Young households in Japan to be given low-energy home subsidies; the subsidy is expected to total up to ¥1M - Japanese press.

- (JP) Japan PM Kishida said to seek ~3.0% wage increase in the Spring wage talks [shunto talks]; notes it has been years since a Japanese PM has set a numerical target for wages - Japanese press.

- (JP) Japan to extend 5G investment tax deduction - Japanese press.

- (JP) Japan Investors Net Buying of Foreign Bonds: -¥12.8B v +¥465.3B prior; Foreign Net Buying of Japan Stocks: -¥47.1B v +¥164.9B prior.

- (JP) Moody's affirms Japan A1 sovereign rating, outlook stable.

- (JP) Japan Govt confirms it will convene extra parliament session on Dec 6th - Press.

Korea

-Kospi opened -0.2%.

- (KR) South Korea expected to announce additional quarantine steps on Nov 29th (Monday).

China/Hong Kong

-Hang Seng opened -1.0%; Shanghai Composite opened -0.2%.

- (CN) China PBOC sets Yuan reference rate: 6.3936 v 6.3980 prior.

- (CN) China PBOC Open Market Operation (OMO): q33Sells CNY100B in 7-day reverse repos v CNY100B prior; Net inject CNY50B v Net inject CNY50B prior.

- (CN) China may set the 2022 special bond issuance quota at CNY3.2T v CNY3.65T y/y - Chinese press.

- (CN) China Economic Daily Commentary: Measures should be taken to secure grain supply, grain supplies expected to remain tight in the long-term.

- (CN) China Economic Information Daily Commentary: Digital yuan (CNY) trial should be expanded after the Winter Olympics.

- (HK) SCMP comments on Thursday's travel talks between HK and China officials: Hong Kong Chief Sec Lee Ka-chiu said HK has meet the basic requirements to reopen the border with mainland China but must tighten certain COVID controls before quarantine-free travel can resume.

- (CN) Japan and Vietnam to increase security cooperation in the South China Sea citing serious concerns - Press.

- China said to have asked DiDi [DIDI] to delist from US Exchanges citing security fears - Press.

- (CN) Beijing said to consider creating digital asset trading exchange - US financial press.

- (CN) Shanghai has cancelled certain flights due to coronavirus - Chinese media.

- (CN) China Ministry of Finance (MOF) Sells 3-month bills: avg yield 2.1027% v 2.1213% prior.

Other

- (MX) Mexico Central Bank (BANXICO) Nov Minutes: Rate hikes could make supply chain shocks worse; Must rule out prolonged, aggressive cycle.

- World Health Organization calls meeting of experts for later on Friday, Nov 26th to speak on whether to declare new coronavirus variant as a variant of concern.

North America

- US Markets closed for the Thanksgiving Holiday.

- (US) Adobe expects US Thanksgiving Day Total Online Spending at $5.1-5.4B.

Europe

- (EU) New COVID variant known as B.1.1.529 found in South Africa reportedly shows high number of mutations in spike - press.

- (UK) UK has suspended flights to 6 countries in Africa on new COVID variant - press.

Levels as of 00:20 ET

- Nikkei 225, -2.8%, ASX 200 -1.7% , Hang Seng -2.3%; Shanghai Composite -0.7% ; Kospi -1.7%.

- Equity S&P500 Futures: -1%; Nasdaq100 -0.6%, Dax -2%; FTSE100 -1.8%.

- EUR 1.1227-1.1206 ; JPY 115.40-114.59 ; AUD 0.7199-0.7133 ;NZD 0.6861-0.6817.

- Gold +0.8% at $1,797/oz; Crude Oil -3% at $76.07/brl; Copper -0.8% at $4.4032/lb.

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