The Overnight News Roundup

Nov 26, 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:

Risk assets saw knee-jerk downside after Trump's latest additional tariff threats, albeit have recovered into the London handover. However, the Yuan, Peso, and Loonie still remain much lower vs the Dollar, and non-US indices have also struggled to recover. Treasuries saw downside on the announcements.
Trump pledged he would imminently charge Mexico and Canada a 25% tariff on all products coming into the US "until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”. (Truth Social)
Trump also said "we will be charging China an additional 10% Tariff, above any additional Tariffs, on all of their many products coming into the [US]", until they stop fentanyl coming into the US. (Truth Social)
Moody's economist says Trump's plan to impose a 10% tariff on China's exports, while lower than earlier campaign promises, may be a prelude to further measures. Said linking the tariff to illegal fentanyl shipments underscores Trump's transactional approach, potentially using other disputes as grounds for additional tariffs.
Bill Ackman said "markets should be up not down on this news", saying that the tariffs are in the best interest of America. (X)
Fed's Kashkari said he is open to cutting interest rates again next month, saying, “It’s still a reasonable consideration”. (BBG)
Alan Blinder in WSJ OpEd says Trump’s Economic Plan Has Inflation Written All Over It. Said Tariffs, tax cuts and deportations could all drive prices higher. So could firing Powell. Said, "the new Trump policies might add 2% to 3% to total inflation over two to three years, a percentage point a year." (WSJ)
The Chinese Embassy in Washington said neither the US nor China would win a trade war after Trump threatened to slap an additional 10% tariff on all Chinese imports. (RTRS)
The PBoC has consistently set its daily reference rate stronger than 7.2 per dollar since the US election, appearing as a line in the sand, despite wild swings in the greenback and increasing predictions by analysts that the central bank would buckle. (BBG)
Japanese PM Ishiba said on Tuesday that he will ask companies to implement significant wage hikes at next year's labour negotiations, as his government puts pay rises at the top of its public policy priorities. (RTRS)
A leading indicator of Japan's service-sector inflation held near 3% in October, offering further evidence that conditions for another near-term interest rate hike by the Bank of Japan were falling into place. (RTRS)
The Japanese government maintained its assessment that the economy is recovering moderately on Tuesday, while cautioning about the potential impact of U.S. President-elect Donald Trump's policies on the economic outlook. (RTRS)
Annual U.K. shop-price deflation lost steam in November, driven by higher fresh-food prices on increased winter-related costs, while retailers’ additional costs next year suggest the end of falling inflation, according to a NielsenIQ report. (WSJ)
Former German Chancellor Merkel and Bavaria’s prime minister Soeder said they’re open to reforming the country’s strict borrowing limits, signaling a departure from the traditional stance of the conservative Christian Democrats. (BBG)
France is eying investments in strategic companies and conducting a review of its corporate assets, the country’s finance minister told Les Echos newspaper just after the government offered to buy Atos SE’s advanced computing business. (BBG)
New Zealand’s government wants the Reserve Bank to consider how its rules may be preventing community housing providers from accessing finance at the best rates. (BBG)
Mexican officials fear a planned BYD plant would send the wrong message to Trump and the trade hawks around him by suggesting that Mexico wants to be a backdoor for Chinese companies to sell to Americans. (WSJ)
Mexico’s finance ministry is preparing to enlist a consortium of banks to provide financing that Pemex would use to pay off debt with service providers, according to a recording of remarks made by its CEO. (BBG)
Russia’s seaborne crude exports saw their biggest drop since July, with shipments sliding to a two-month low, as flows to key buyer India fell sharply. (BBG)
Goldman Sachs expects no near-term impact on global gas supplies due to the potential approval for proposed U.S. liquefaction projects, as they would need government clearance as well as long-term contracts to go ahead. (RTRS)
Chinese buyers are loading up on Brazilian soybeans from the coming harvest, taking advantage of attractive prices in a move that will also help safeguard supply, at a time when concerns about worsening trade tensions with the US are running high. (BBG)
Iron ore prices have rallied this week as Chinese steel mills churn out more metal than usual at the beginning of the low season. (BBG)
Bitcoin posted its longest losing streak in the period since Trump’s victory, after a failed run at $100,000 cooled the speculative fervor sparked by the president-elect’s embrace of crypto. (BBG)

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GEOPOLITICAL:

Russian forces are advancing in Ukraine at the fastest rate since the early days of the 2022 invasion, taking an area half the size of Greater London over the past month, analysts and war bloggers say. (RTRS)
The European Union is proposing to sanction several Chinese firms that it claims helped Russian companies develop attack drones that were deployed against Ukraine. (BBG)
Russian Foreign Minister Lavrov said NATO has stopped keeping up appearances when it declared the possibility of preemptive strikes against Russia. (TASS)
China's military said it monitored and "effectively" responded to a U.S. Navy aircraft's transit of the Taiwan Strait on Tuesday. (RTRS)
China's Ambassador to Australia said on Tuesday the United States' policy on trade with China and other countries will have an impact on relations between Canberra and Beijing. (RTRS)

EQUITIES:

Apple is facing an uphill battle to release its own AI models for iPhones and other products in China, with a top Beijing official warning that foreign companies will confront a “difficult and long process” to win approval unless they partner with local groups. (FT)
Brazilian antitrust regulator Cade said Apple must lift restrictions on payment methods for in-app purchases, among other things, as the watchdog moved to proceed with an investigation into a complaint filed by Latin America e-commerce giant MercadoLibre. (RTRS)
Qualcomm's interest in acquiring Intel is said to have cooled due to complexities associated with the deal. (BBG)
Walmart plans to cut back some of its diversity, equity and inclusion (DEI) initiatives, a spokesperson for the retailer said, joining a growing list of firms feeling the heat from conservative groups. (RTRS)
Citigroup is cutting the number of year-end promotions it awards as it seeks to hold costs down amid a long-term restructuring to shrink headcount. (FT)
Google and Meta urged the Australian government on Tuesday to delay a bill that will ban most forms of social media for children under 16, saying more time was needed to assess its potential impact. (RTRS)
Japan's FTC on Tuesday conducted an on-site inspection of Amazon Japan on suspicion of violating anti-monopoly laws, a government source said. (RTRS)
Rivian Automotive received conditional approval for a loan of up to $6.6 billion from the government to boost its EV production capability. (WSJ)
The NHTSA said it will not reconsider a landmark rule finalized in April requiring nearly all new cars and trucks by 2029 to have advanced automatic emergency braking systems. (RTRS)
Kohl's CEO Tom Kingsbury will step down after less than two years at the helm, paving the way for former Walmart executive Ashley Buchanan to take on the role as the department store chain looks to execute a turnaround. (RTRS)
UniCredit's bid for Banco BPM has reportedly upset the latter's execs, with sources describing the offer price as "almost offensive," according to Il Sole 24. (Newsquawk)
TPG is reportedly in advanced talks to purchase the Indian wind energy unit of Siemens Gamesa, which could fetch over USD 300mln. (Newsquawk)
Roche said it will acquire biopharmaceutical company Poseida Therapeutics in a deal worth up to $1.5 billion. The deal includes Poseida Therapeutics cell-therapy candidates and related platform technologies. (WSJ)
One of UBS's JV partners in China will sell its entire holding in a securities company, paving the way for the Swiss bank to fully own a sizeable securities brokerage in the world's second-largest economy. (RTRS)
Taiwan’s semiconductor output in October soared by a record 19.78% due to strong demand for high performance computing (HPC) and AI chips, and double-digit growth will continue for the next two months, the economics ministry said. (UDN)
Prosecutors are seeking a 5-year jail term for Samsung Electronics Chairman Jay Lee in a retrial over suspected stock manipulation related to a 2015 merger. (Korea Herald)
MedaiTek, the smartphone chip giant, unveiled its first whitepaper on WiFi 8, as it seeks to prepare chips for MR/XR goggles and other wearable devices. WiFi 7 chips are now on the market. (CTEE)
Nissan To Extend U.S. Production Cuts To March 2025. (Nikkei)
Nissan Motor is looking for a long-term investor, such as a bank or insurance group, to help it replace some of Renault's diluted stakeholding. (FT)
Huawei Technologies unveiled its Mate 70 smartphone series on Tuesday, advancing its comeback in the premium smartphone space while showcasing its own operating system in a clean break away from U.S. technology. (RTRS)