UK budget and US Thanksgiving in week ahead

EU mid-market update: UK budget and US Thanksgiving in week ahead; End of sell off or dead-cat bounce?

Notes/observations

- Risk off mood from last week has faded away somewhat after Fed’s Williams comments on Fri. They were dovish enough to tip the balance back towards bulls after week of volatility that was focused on AI bubble and overpriced valuations. Bitcoin stabilizes drawdown, now off recent lows at $85K.

- With earnings season behind us and US Thanksgiving on Thurs-Fri taking away 1.5 days of trade this week, lighter liquidity is expected but catalysts continue. European focus revolves around UK Autumn Budget on Wed, Nov 26th, while global macro awaits more details on Ukraine peace plan talks. In AI space, looking out for jumbo ~$38B Oracle debt offering and Michael Burry’s sell-side report on Oracle and Meta accounting tactics tomorrow, Tues, Nov 25th.

- CreditSights' senior analysts warn that Oracle may need to issue roughly $65B in additional bonds over the next three years, but must preserve its investment grade because high-yield markets cannot support funding needs of that magnitude. Some argue that the real DeepSeek style shock now lurking in the AI sector is a scenario where credit markets quietly refuse to finance Oracle’s next AI data-center wave, exposing credit rather than compute as the first true choke point of the AI era.

- Sky News analysts say the OBR will forecast weaker UK growth in 2026 and in every remaining year of the current parliament. This adds pressure to Reeves’s Nov 26th Budget, which is already shaping into a revenue heavy, stealth tightening designed to rebuild gilt credibility without pushing a stagnating economy into a 2026 recession. The darker growth profile also limits how much political and market goodwill the Chancellor can rely on if the Budget leans too heavily on optimistic assumptions or underdelivers on concrete consolidation.

- Press reports again say the White House is weighing options on Venezuela that include attempts to undermine or potentially overthrow the Maduro government. According to those reports, a new phase of Venezuela operations is prepared to begin, starting with covert activity.

- Asia closed mixed with Nikkei225 underperforming -2.4%. EU indices -0.6% to +0.9%. US futures +0.0-0.5%. Gold +0.2%, DXY -0.1%; Commodity: Brent -0.7%, WTI -0.4%; Crypto: BTC +0.1%, ETH -0.1%.

Asia

- Japan markets closed for holiday.

- BOJ Board Member Masu: Close to decision to raise rates, can't say which month; The environment is favorable for raising rates. Would not wait until after the Spring wage talks end to raise interest rates.

- Japan said to be open to intervening in the currency market to mitigate the side effects of a weak yen currency.

Taiwan

- Japan Defense Min said Tokyo to deploy missiles to military base near Taiwan.

Global conflict/tensions

- US secretary of state Rubio said a “tremendous” amount of progress had been made on Ukraine (**Note: Europe lays down red lines on Ukraine in rebuke to Trump plan).

- US said to launch new phase of Venezuela operations to ramp up pressure on Maduro government.

Europe

- ECB Lagarde reiterated monetary policy cannot solve debt issues (**Note: Lagarde said to implicitly rejecting recent suggestions from France’s far-right party that ECB should relaunch large-scale asset purchases.

- France parliament said to have rejected 2026 budget draft (**Insight: PM Lecornu needs to find agreement by end of the year).

- SNB President Schlegel noted that inflation was within the range of price stability and likely to rise slightly in the coming quarters.

- UK Chancellor Reeves London Times Oped noted how her budget will tackle inflation and help growth.

- Chancellor Reeves said to plan to hit more than 100,000 of Britain’s most expensive properties with a surcharge worth an average of £4,500.

- Moodys affirmed UK sovereign rating at Aa3; Outlook Stable.

- Moodys raised Italy sovereign rating one notch to Baa2 from Baa3; Outlook revised to Stable from Positive.

Americas

- Treasury Sec Bessent: US economy as a whole not at risk of recession.

Speakers/fixed income/FX/commodities/erratum

Equities

Indices [Stoxx600 +0.33% at 563.98, FTSE +0.28% at 9,566.10, DAX +0.85% at 23,292.65, CAC-40 % at #, IBEX-35 +0.74% at 15,947.50, FTSE MIB -0.64% at 42,390.00, SMI +0.34% at 12,663.46, S&P 500 Futures +0.29%].

Market focal points/key themes: European indices open higher and advanced through the early part of the session; markets showing sign of stabilization in tech sector and renewed hopes of monetary policy easing; among sectors leading the way higher are materials and technology; lagging sectors include consumer discretionary and financials; defense subsector under pressure amid reported progressed towards reaching a peace deal on Ukraine war; BHP desists from its bid for Anglo American; IMI sells Truflo marine to Fairbanks Morse Defense; earnings expected in the upcoming US session include Agilent and Zoom.

Equities

- Consumer discretionary: Ubisoft [UBI.FR] +7.5% (momentum from earnings), Entain [ENT.UK] +2.5% (analyst upgrade).

- Financials: Julius Bär [BAER.CH] -4.5% (trading update).

- Healthcare: Bayer [BAYN.DE] +10.0% (trial data).

- Industrials: Rheinmetall [RHM.DE] -3.5% (more Ukraine peace deal talks), BASF [BAS.DE] +1.5% (analyst downgrade).

Speakers

- UK OBR forecasts said to say that growth would be lower in 2026 and every remaining year of parliament.

- EU Council Pres Costa: A united and co-ordinated EU position is key to ensure a good outcome of peace talks for Ukraine and Europe.

- Ukraine Pres Spokesperson Brusylo: Peace plan negotiations to continue over next few days. NATO membership was not off table completely for Ukraine. Zelenskiy and Trump to finalize idea of territorial issue.

- Philippines Central Bank (BSP) Gov Remolona: Inflation expectations more or less anchored; Still working to try measure anchoring more precisely.

Currencies/fixed income

- FX markets began the week on a quiet note as the USD consolidated its recent gains.
EUR/USD steady at 1.1530.

- USD/JPY holding around 156.70 area. Dealers continued to speculate when and if BOJ would intervene to halt yen weakness. The 160 area continued to be a key point to watch.

Economic data

- (FI) Finland Oct PPI M/M: +0.3% v -0.4% prior; Y/Y: +0.2% v -0.3% prior.

- (NO) Norway Oct Credit Indicator Growth Y/Y: 3.9% v 3.9% prior.

- (TR) Turkey Nov Real Sector (Manufacturing) Confidence: 103.2 v 102.0 prior; Real Sector Confidence (unadj): 100.8 v 100.8 prior; Capacity Utilization: 74.4% v 74.2% prior.

- (CZ) Czech Nov Consumer Confidence: 111.7 v 106.6e; Business Confidence: 99.9 v 103.6e.

- (TW) Taiwan Oct Unemployment Rate: 3.3% v 3.4%e.

- (TW) Taiwan Oct M2 Money Supply Y/Y: 5.0% v 5.4% prior; M1 Money Supply Y/Y: 4.8% v 5.2% prior.

- (CH) Swiss Weekly Total Sight Deposits (CHF) 460.2B v 456.5B prior; Domestic Sight Deposits: 439.8B v 436.9B prior.

- (DE) Germany Nov IFO Business Climate: 88.1 v 88.5e; Current Assessment: 85.6 v 85.5e; Expectations Survey: 90.6 v 91.6e v.

- (PL) Poland Oct Sold Industrial Output M/M: 5.4% v 3.6%e; Y/Y: 3.2% v 2.2%e; Construction Output Y/Y: 4.1% v 0.8%e.

- (PL) Poland Oct Employment M/M: -0.1% v -0.1% prior; Y/Y: -0.8% v -0.8% prior.

- (PL) Poland Oct Average Gross Wages M/M: 1.3% v 2.0%e; Y/Y: 6.6% v 7.2%e.

- (PL) Poland Oct PPI M/M: -0.2% v -0.2%e; Y/Y: -2.2% v -1.8%e.

Fixed income issuance

- None seen

Looking ahead

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

- 05:30 (DE) Germany to sell €3.0B in 6-month bills.

- 06:00 (BR) Brazil Nov FGV Consumer Confidence: No est v 88.5 prior.

- 06:00 (IT) ECB's Cipollone (Italy).

- 06:00 (RO) Romania to sell RON 800M combined in 2031 and 2038 bonds.

- 06:00 (IL) Israel to sell ILS 2.5T in bonds (6 tranches).

- 06:25 (BR) Brazil Central Bank Weekly Economist Survey.

- 07:00 (CL) Chile Oct PPI M/M: No est v 1.7% prior.

- 07:00 (IN) India announcement on upcoming bond auction on Fri.

- 07:45 (NL) ECB's Elderson (Netherlands)- 08:00 (UK) Daily Baltic Dry Bulk Index.

- 08:00 (ES) Spain Debt Agency (Tesoro) size announcement on upcoming issuance.

- 08:50 (FR) France to sell 3-month, 6-month and 12-month bills.

- 08:30 (US) Oct Chicago Fed National Activity Index (**Note: likely delayed due to recent govt shutdown).

- 08:30 (BR) Brazil Oct Tax Collections (BRL): No est v 216.7B prior.

- 09:00 (IL) Israel Central Bank (BOI) Interest Rate Decision: Expected to cut Base Rate by 25bps to 4.25%.

- 09:00 (BE) Belgium Nov Business Confidence: No est v -9.1 prior.

- 09:45 (EU) ECB Chief Lagarde.

- 10:30 (US) Nov Dallas Fed Manufacturing Activity: -2.0e v -5.0 prior.

- 11:30 (US) Treasury to sell 13-week and 26-week bills- 12:00 (US Annual revisions to Industrial Production data.

- 12:45 (DE) ECB's Nagel (Germany).

- 13:00 (US) Treasury to sell 2-year notes.

- 16:00 (KR) South Korea Nov Consumer Confidence: No est v 109.8 prior.

- 18:30 (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index.

- 21:00 (KR) Korea to sell KRW 500B in 20-year bonds.

- 22:00 (TH) Thailand to sell THB 65B in 3-month bills.

- 22:30 (TH) Thailand Oct Customs Trade Balance: -$1.2Be v +$1.3B prior; Exports Y/Y: 6.5%e v 19.0% prior; Imports Y/Y: 8.3%e v 17.2% prior.