Markets in holding pattern after recent volatility

Asia market update: Markets in holding pattern after recent volatility; JP Fin Min warns against weak Yen.

General trend and developments

- Asian equities edged higher in a holding range after yesterday’s early sharp price rise was followed by an equally sharp pull back.

- Kospi outperformed with Korean stock index volatility rising to the highest level since April’s tariff shock amid concerns the Kospi index’ bull rally has over-extended since doubling from April.

- USD broke through Tuesday’s 9-month highs against the Yen to reach 154.77. Advance halted by warning comments out of the Japan Fin Min that disadvantages of a weak Yen outweigh advantages.

- Australia Q3 home loan and investor loan values jumped in the third quarter, coming the day after a 7-year high and 13% jump in consumer confidence.

- RBA Deputy Gov Hauser believes Australia may no longer be in a mildly restrictive environment, directly stating that this has “important implications for future policy”. [Aussie dollar stayed within the day’s trading range and there or thereabouts when two days ago when Hauser reiterated the hawkish tone of Gov Bullcok after the last rate decision in early November.].

- A US financial press sentiment index for Japan manufacturers hit its highest since Jan, 2022. Electronics and auto sectors led amid the weak Yen and global demand for chips.

- China's extended 11.11 “Singles Day” annual shopping festival showed consumer caution amid deflation, with consumers searching for value and necessities as opposed to the “buy, buy, buy” mentality of years past - despite bright spots such as JD.com reporting its order volume +60% y/y, perhaps using its size to take market share from less well-financed outlets. JD did not release its margin data for the period.

- China PBOC released its Q3 monetary policy report overnight, reiterating it will keep 'appropriately loose' policy stance with ample liquidity.

- Taiwan again reportedly nearing a trade deal with US, with expected US tariff rate decision by end of Nov (Reminder that on July 31st the US reduced to 20% the tariffs on goods from Taiwan (down from 32%). Vietnam also closing in on a final agreement with the US.

- China state media continued the over-the-top bellicose language against Japan PM Takaichi’s verbal defense of Taiwan saying she may have to 'pay the price' for 'spewing shit'.

- The White House reportedly considering to limit via Executive Order the influence of shareholder advisory firms such as ISS and Glass Lewis (in addition to index giant Blackrock) by restricting their widespread use of shareholder proxy votes to push through their own agendas on listed companies.

- US equity FUTs +0.2% to +0.3% during Asian trading.

Looking ahead (Asian-weighted releases, using Asian time zone)

- Wed Nov 12th IN Oct CPI.

- Thu Nov 13th AU Oct Jobs, (Thu eve UK Q3 prelim GDP).

- Fri Nov 14th NZ Oct Business PMI, CN Oct data dump.

Holidays in Asia this week

- No holidays in Asia this week.

Headlines/economic data

Australia/New Zealand

- ASX 200 opens +0.2% at 8,832.

- Australia Q3 Home Loans Value Q/Q: 9.6% v 2.6%e.

- Australia sells A$1.2B v A$1.2B indicated in 4.25% Dec 2035 bonds: Avg Yield: 4.3643% v 4.2436% prior; bid-to-cover: 3.49x v 3.38x prior.

- Australia PM Albanese: Concludes bilateral treaty security negotiations with Indonesia - financial press.

- RBA Deputy Gov Hauser: If it turns out we are no longer mildly restrictive, that has important implications for future policy.

- Australia RBA Asst Gov (Financial) Jones: Surprised by benign market pricing globally; Notes markets' difficulty in pricing risks such as macroeconomic concerns.

China/Hong Kong

- Hang Seng opens +0.2% at 26,754; Shanghai Composite opens -0.2% at 3,996.

- Japan PM Takaichi may have to 'pay the price' for 'spewing shit' - China state media.

- Saudi Arabia Dec crude oil supply to China expected to decline to 36M barrels v 40M m/m - US financial press.

- JD.com: Provides Double 11 Shopping Festival update; order volume +60% y/y.

- China MOFCOM: Regarding US pause of affiliate rule, two sides will talk about arrangement after one-year pause [overnight update].

- China PBOC Q3 Monetary Policy Implementation Report: To maintain relatively loose financing conditions; (prior in Q2 'moderately loose monetary policy'); China has foundation to achieve full-year growth target; To give full play to guiding role of monetary policies [overnight update].

- China State Planner NDRC: Private investment has slowed down this year, faces challenges - financial press [overnight update].

- China PBOC sets Yuan reference rate: 7.0833 v 7.0866 prior (strongest since Oct 15th, 2005.

- China PBOC Open Market Operation (OMO): Injects CNY196B in 7-day Reverse Repos; Net injects CNY130B v injects CNY286B prior.

Japan

- Nikkei 225 opens +0.3% at 50,988.

- Japan Oct M3 Money Supply Y/Y: 1.0% v 1.0% prior.

- BOJ Outright Bond Purchase Operation for 1~3 Years; 5~10 Years; 10~25 Years; (Leaves purchase amounts unchanged).
Japan Fin Min Katayama: Will not deny disadvantages of weak Yen outweighintg advantages; Watching FX levels with a high sense of urgency incl moves that are 'speculative'.

- Japan PM Takaichi: Reiterates cannot say whether Japan has emerged from deflation.

- Softbank Exec: “I don’t think I can answer whether AI is in a bubble, but this is just the beginning and volatility is natural—our focus is capturing upside while protecting our financial strength” - earnings call [overnight update].

- Japan LDP Policy Chief Kobayashi: Economic package proposal focuses on inflation and growth; See gap with fiscal authorities on package size - comments from Tokyo [overnight update].

Korea

- Kospi opens -0.2% at 4,097.

- South Korea Oct Unemployment Rate: 2.6% v 2.6%e.

- South Korea Sept M2 Money Supply M/M: 0.7% v 1.3% prior.

- Bank of Korea (BOK) Gov Rhee: Reiterates the data dependence of the central bank.

Other Asia

- Indonesia Central Bank (BI) Gov Warjiyo: Sees 2026 Avg Headline CPI at 2.62%, 2026 GDP growth at 5.33% or up to 5.4% if fiscal spending accelerated.

- Follow up: Vietnam Dep PM: Expects to sign a trade deal with the US "soon" - financial press.

- Reportedly Taiwan is close to a trade deal with US; Taiwan expects to announce US tariff rate decision by the end of Nov - Asia press.

North America

- (US) White House said to consider Exec Order relating to restricting the influence of shareholder advisory firms - WSJ.

- US Pres Trump: Plans to lower some tariffs on coffee - Fox News interview.

- (US) Treasury Sec Bessent: Lot of heating costs come down to the states; Trump administration inherited a high price level - MSNBC.

- (US) ADP preliminary employment change for 4-weeks ending oct 25th: -11.3K.

- (MX) Mexico Econ Min Ebrard: Mexico govt working to finish up discussions with US in Nov; May travel to Washington, DC, again this month

- (MX) Mexico Oct Nominal Wages Y/Y: 5.8% v 3.9% prior.

- (US) Reportedly some US airline CEOs sought justification for flight cuts from Trump officials - press.

- US Pres Trump said to be planning to dine with industry execs tomorrow (11-12), incl Nasdaq CEO Friedman; JPMorgan CEO Dimon was also invited (his attendance was not confirmed) - CBS.

Europe

- UK Foreign Sec Cooper: UK will seek to tighten restrictions on Russian gas exports over the next year, alongside other EU nations (update).

- (YE) Yemen Houthis have signaled they will stop attacking ships in the Red Sea, potentially placing downward pressure on global shipping prices - FT (update).

- (CH) Reportedly Swiss close to sealing tariff deal with US for tariffs at 15%, but such trade deal to reduce tariffs is not certain until Pres Trump approves it - press.

- (UK) UK rejects EU demand for €6.75B to join key European defense fund - press.

- (DE) Bundesbank proposes debt brake reform; Would set three stage plan to stabilize German debt - press.

- (EU) ECB's Escriva (Spain): Spanish economy to continue growing at similar pace.

- (UK) Reportedly UK banks have pushed to ease capital rules to counter an uptick in private credit - press.

Levels as of 01:20 ET

- Nikkei 225 +0.1%, ASX 200 -0.2%, Hang Seng +0.2%; Shanghai Composite -0.4%; Kospi +1.0%- Equity S&P500 Futures +0.2%; Nasdaq100 +0.3%.

DAX +0.4%; FTSE100 flat.

- EUR 1.1570-1.1587; JPY 154.05-154.79; AUD 0.6516-0.6532; NZD 0.5646--5660.

- Gold -0.1% at $4,114/oz; BTC -1.8% at $103,480; Crude Oil -0.3% at $60.84bbl; Copper -0.3% at $5.0433/lb.