DAILY ASIA-PAC OPENING NEWS

ASIA-PAC

US President Trump tweeted that China has sent very strong signals once they returned home from their long trip from Argentina and that he believes President Xi meant every word of what he said. (Newswires)

China is reportedly to clean up restrictions related to foreign investment. (Newswires)

Fonterra revised its 2018/2019 forecast farmgate milk price to NZD 6.00-6.30/kg from NZD 6.25- 6.50/kg. (Newswires)

RBI kept its rates unchanged with the Repurchase Rate held at 6.5% as expected and maintained its ‘calibrated tightening stance’. Furthermore, the RBI proposed a 25bps reduction in the SLR each quarter until it reaches 18% which will start in Q1 2019. (Newswires)
 

UK

DUP’s Brexit spokesperson Wilson said we had arrangement to keep the government in power and the government broke its promises. Elsewhere, an ITV political correspondent tweeted that an ERG source said the DUP has pledged to back the Government in a Confidence motion if the withdrawal agreement is voted down” however if “the withdrawal agreement is voted through they are likely to withdraw their support”. (Newswires/Twitter)

The Brexit legal advice was published which stated backstop could mean the UK is subject to protracted and repeating rounds of negotiations and that these talks could still be taking place years later, while the UK would be breaking the law if it left the backstop without the EU’s agreement. (BuzzFeed)

Telegraph’s Swinford tweeted that Clause 7 of Geoffrey Cox’s legal advice will infuriate DUP as the arrangements as a whole apply differently in GB and NI with NI in EU customs union and GB in a separate customs union. (Twitter)

European Commission Vice-President Dombrovskis said EU has contingency planning if the UK rejects Brexit deal. (Newswires)

UK’s Unite union leader warned opposition Labour party against backing a second EU referendum. (Guardian)

UK Markit/CIPS Services PMI (Nov) 50.4 vs. Exp. 52.5 (Prev. 52.2). (Newswires)

EU

ECB is said to debating ideas for gradual stimulus withdrawal in 2019 according to sources, while reports added that some policy makers favour hiking only deposit rate at first and that the door for TLTRO is seen open with suggestion to make it permanent and at floating rate. (Newswires)

Italy’s PM Conte said he is to meet EU’s Juncker on Tuesday with the new proposal on the 2019 budget and added that it will include boosting investments. (Adnkronos)

EU Retail Sales YY Oct 1.7% vs. Exp. 2.1% (Prev. 0.8%, Rev. 0.3%). (Newswires)
 

FX

Bank of Canada kept rates unchanged at 1.75% as expected while it commented that rates will have to increase to a neutral range to hit inflation target and that data suggests Canadian economy has less steam going into Q4. (Newswires)
 

COMMODITIES

OPEC discussed a cut between 800k-900k BPD and will continue to discuss levels on Thursday, while delegates are said to be split on which month will be used for the baseline month. Furthermore, reports noted that Iraq is agreeable to joining the cuts, while the Oman OPEC official said Nigeria and Libya agreed not to be exempt from oil cut agreement. (Argus/Newswires)

There were earlier comments from an OPEC+ delegate that committee recommended a supply reduction although there was no specific figure for the cut and sources stated that Russia has agreed to cut oil production in tandem with OPEC and allies in 2019. Furthermore, Oman Oil Minister commented the cut will be from Jan for six months and that the figure agreed by OPEC could be a 1mln BPD cut in which the baseline for the cut will be Sept or Oct, while a delegate had earlier suggested tomorrow’s meeting may not agree specific numbers and that OPEC needs to factor in the impact of Canada’s supply reduction last week, as well as potential reductions from Venezuela and Iran. (Newswires)

US President Trump tweeted that hopefully OPEC will be keeping oil flows as is, not restricted and that the world does not want to see, or need, higher oil prices. (Twitter)
 

GEOPOLITICAL

US National Security Advisor Bolton said North Korea has not lived up to its commitments so far. (The Hill)

US makes preparations to sail warship into Black Sea amid Russia-Ukraine tensions. (CNN)

Iran President Rouhani said Iran would have no problems holding timely negotiations with the US, provided the US accepted its rightful positions, while he added that the US sends it requests for talks everyday. (Mehr)

The White House is still considering labelling Venezuela a state sponsor of terrorism, which would result in a de facto ban on US imports of Venezuela’s crude oil and imperil PDVSA’s US assets. (Platts)
 

US

Fed’s Beige Book stated that most of the 12 districts reported that their economies expanded at a modest or moderate pace from mid-October through late November. It was also noted that tariffs remained a concern for manufacturers, but a majority of districts continued to report moderate growth in the sector. (Newswires)

MARKET RECAP

US Markets were closed for a National Day of Mourning, while there was a risk-off tone across European equity markets which followed suit to the prior day’s losses in their US and Asia-Pac counterparts.

(Newswires)