The Overnight News Roundup

Dec 04, 2024

PiQ and Zack Eiseman provide you with a consolidated roundup of the overnight news that matters most to markets.

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MACRO:

Some news agencies report BoJ officials are leaning towards unchanged in December absent USDJPY rising to 160 amid political pressure. (newswires)
The BoJ has sold some of its holdings of futures-linked 10-year government bonds to improve the trading liquidity of these securities, which are often used as hedging tools against market volatility. (BBG)
Yuichiro Tamaki, a kingmaker for Japan’s minority government, will temporarily step down as his party’s leader amid a scandal over an alleged marital infidelity. (BBG)
The Australian dollar skidded to four-month lows on Wednesday as surprisingly soft economic data led markets to bring forward the likely timing of future rate cuts, triggering a rally in bonds. (RTRS)
China's services activity expanded at a slower pace in November, pressured by easing new business growth, including in exports, the Caixin/S&P survey showed. (RTRS)
China increased its support for the yuan by setting a significantly stronger-than-expected daily reference rate, after the managed currency weakened to a one-year low in the previous session. (BBG)
China’s historic bond rally is likely prompting traders to take on more leveraged bets, seen via by a surge in overnight repo contracts, driven by expectations of further policy easing amid concerns over the impact from the potential US tariffs. (BBG)
China could approve another 100 nuclear reactors over the coming decade, according to an industry lobby group, as the nation turns itself into the world’s biggest operator of atomic power and potentially a major exporter of the technology. (BBG)
U.S. Senate Republicans are discussing a two-step plan to push ahead on Trump's agenda when they take the majority next year, starting with border security and energy before turning to tax cuts. (RTRS)
Trump is considering Florida Gov. Ron DeSantis as a possible replacement for Pete Hegseth, his pick to run the Pentagon amid Republican senators’ concerns over mounting allegations about the former Fox News host’s personal life. (WSJ)
France‘s no-confidence vote is emboldening currency options traders to short the euro against the yen. Euro-yen options trading on the DTCC has surged recently. The currency pair’s three-month implied volatility is hovering near its highest level since August. (BBG)
French lawmakers will vote on Wednesday on no-confidence motions which are all but certain to oust the fragile coalition of Prime Minister Michel Barnier. (RTRS)
ECB's Nagel said the German economy faces a weak outlook and 2025 is likely to be another year of weak growth, while he also called for a softer debt brake to ramp up investment. (FT)
ECB's Holzmann said a 25bps rate cut is conceivable in December and not more, adds nothing decided on next rate move and will depend on data available at the December meeting. (Newsquawk)
ECB's Rehn said he sees more grounds for the ECB to cut rates in December and sees policy easing continuing in the months ahead. (BBG)
A retreating euro will remain weak in the near term, trapped between political ructions building in France and expected new U.S. tariffs early next year that are boosting the dollar's allure, a Reuters poll of market strategists found. (RTRS)
South Korean lawmakers called on President Yoon Suk Yeol to resign or face impeachment after he declared martial law. (RTRS)
The BOK will increase short-term liquidity and take “active” steps in currency markets as needed to ensure stability, it said in a statement following a hastily-called board meeting. (BBG)
Four UK nuclear reactors are going to stay online for longer than expected as the country works toward decarbonizing the grid. (BBG)

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GEOPOLITICAL:

There are no grounds yet for negotiations on how to bring the war in Ukraine to an end, Russia said on Wednesday, in comments about peace talks that have become more frequent since Donald Trump won the U.S. presidential vote in November. (RTRS)
Tucker Carlson announced in a post on X late Tuesday that he’d returned to Russia to interview its Foreign Minister Sergey Lavrov, with the interview to be released "soon". (Politico)
The Israel-Hezbollah ceasefire agreement "will endure and not collapse despite all the shocks it has experienced since its announcement", according to a government source via Lebanese newspaper cited by Israeli journalist. (Newsquawk)

EQUITIES:

Salesforce shares rallied after the company reported its fiscal third-quarter earnings, despite mixed guidance.
Nvidia’s Rubin platform could be available six months ahead of schedule (originally due in 2026), as the AI chip giant is already working with supply chain partners in Taiwan on the successor to Blackwell. (UDN)
UnitedHealth forecast adjusted profit for 2025 largely in line with Wall Street estimates, ahead of its annual investor conference. (RTRS)
Intel has started evaluating a handful of outsiders, including former board member Lip-Bu Tan, for the role of chief executive. Decision expected in coming weeks. (RTRS)
Marvell Technology forecast fourth-quarter revenue above estimates, betting on robust demand for its custom AI chips from businesses adopting booming generative AI technology. (RTRS)
Meta Platforms Inc. is seeking as much as 4 gigawatts of new nuclear energy to run data centers and support the US electric grid, starting in the early 2030s. (BBG)
Okta surged in extended trading after the identity management company released third-quarter results that beat analysts’ estimates and offered rosy guidance. (CNBC)
Citigroup Inc. is facing potential losses of as much as A$41 million ($26 million) after it was unable to fully sell a block of shares in Australia’s Goodman Group it had underwritten for China’s sovereign wealth fund. (BBG)
Wells Fargo is set to sell its San Francisco headquarters, part of a broader shift in the bank’s power base to the East Coast. (WSJ)
Stellantis' Chairman John Elkann plans to name Luca Maestri, the outgoing CFO of Apple, as the new CEO of the Italian-French carmaker after Sunday's shock resignation of Carlos Tavares. (Corriere della Sera)
ASM International NV said that the new U.S. export controls were largely in line with its earlier 2025 outlook, based on a preliminary analysis. (RTRS)
Ericsson has secured a multi-billion-dollar, multi-year deal with Bharti Airtel to supply advanced 4G and 5G RAN products, enhancing network coverage and capacity across India. (Newsquawk)
South Korea said the latest US export controls on China will only have a limited impact on its semiconductor industry, which relies little on China now. (Korea Times)
Taiwan electronics giant Quanta President says the Co. still sees nonstop orders for AI servers, with not even a hint of interruption amid rumours of overheating Nvidia chips or other faulty parts, adding those worried about AI demand peaking in 2025 or 2026 are “overthinking” the situation. (UDN)
China’s major technology stocks have been left behind in this year’s global frenzy over AI, and a lack of demand for actual AI usage coupled with geopolitical pressures make it unlikely they can cash in anytime soon. (BBG)
The ¥9 trillion ($60 billion) proposed management buyout of Seven & i Holdings Co. is set to include plans for an IPO of its North American convenience stores and gasoline stations business to ease financing concerns. (BBG)
Qatar will invest 1 billion pounds in climate technology in the United Kingdom, with Rolls-Royce set to benefit from some of the cash to support its energy transition. (RTRS)
Rio Tinto forecast higher consolidated mined copper production for fiscal 2025, driven primarily by an anticipated 50% surge in output from its Oyu Tolgoi operation in Mongolia next year. (RTRS)
Rio Tinto is under pressure from activist investor Palliser Capital to get the Co. to abandon its London listing. (FT)