The Overnight News Roundup

Jan 07, 2025

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

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MACRO:

Trump is expected to meet Republican U.S. senators on Wednesday, a Republican aide said, as the president-elect urges his party to combine his priorities into one massive bill. The aide added that a time and location for the meeting were still to be determined. (RTRS)
Trump reiterated his interest in Greenland, posting, "...Greenland is an incredible place, and the people will benefit tremendously if, and when, it becomes part of our Nation. We will protect it, and cherish it, from a very vicious outside World. MAKE GREENLAND GREAT AGAIN!" (Truth Social)
US corporate bankruptcies have hit their highest level since the aftermath of the global financial crisis, rising 8% Y/Y to 686 companies in 2024, as elevated interest rates and weakened consumer demand punish struggling groups. (FT)
Currency options trading volumes surged to a very high $108 billion on Monday amid political headline volatility, surpassing the activity seen on the Fed and BoJ policy announcement days last month. (BBG)
China attaches "great importance" to the remarks of Donald Trump, the foreign ministry said in response to comments on Monday from Trump saying he has been in talks with Chinese President Xi Jinping through their aides. (RTRS)
China's state planner published testing guidelines on building a national unified market, saying the country will implement a unified market access system and safeguard fair competition, preventing local governments from implementing preferential investment policies. (RTRS)
Governments in China at all levels have begun stabilizing expectations, expanding demand, and strengthening industries to make a good start for growth for the year. (Securities Times)
Yuan funding costs in Hong Kong surged to levels unseen in years, making it more expensive to short the currency. Traders note tightening liquidity in the swap market amid heavy borrowing demand, particularly from state-owned banks. (BBG)
China’s yield discount to the US has expanded to a fresh record 300bps, aggravating the challenge for a central bank that’s already fighting gravity to support the yuan. (BBG)
The number of foreclosed homes in China rose in 2024 from the previous year, a private-sector survey showed, heightening concerns about mortgage delinquencies amid the property slump. Repossessed homes up for auction rose to 370k from 364k in 2023. (RTRS)
China's fixed income market outlook survey records over 50% of institutions expect China to cut its RRR in January, while nearly 80% anticipate a cut in the next three months. (MktNews)
China continued adding gold to its reserves in December for a second straight month after a pause earlier in 2024. (BBG)
Bloomberg notes recent strong pricing of junk bond issues in China, although property developers remain a weak spot. (BBG)
Japan's Nikkei share average climbed on Tuesday by nearly 2%, snapping a two-session losing streak, as chip-related stocks tracked their U.S. peers higher. (RTRS)
The yen slid to its weakest since July against the dollar, underperforming all major currencies, with analysts attributing the drop to Japanese retail investors’ outflows as well as to Tokyo benchmark fixing. (BBG)
Japan Finance Minister Kato issued a fresh warning against speculative yen selling, saying the government has been alarmed and will take appropriate action against excessive moves. (RTRS)
Mark Carney is considering running for leadership of Canada’s Liberal party after prime minister Justin Trudeau’s resignation this week. (FT)
Australian building approvals were weaker than expected in November, denting hopes of a big recovery in housing supply to meet surging immigration. (WSJ)
Hedge funds are loading up on Australian dollar shorts as the threat of US tariffs and the impact of a sluggish Chinese economy bludgeon the currency. Leveraged funds boosted their bearish Aussie wagers to the most since March 2022, CFTC data showed. (BBG)
UK retail sales spending growth was “minimal” and below the rate of inflation in the final three months of 2024, according to BRC data, suggesting consumers remained cautious in what is typically the busiest period of the year for shops. (FT)
UK house prices dropped unexpectedly last month for the first time since March although they finished the year higher than in December 2023, figures from mortgage lender Halifax showed. (RTRS)
EGBs found a bid after French inflation came in lower than expected, paving the way for the ECB to cut rates again later this month. (WSJ)
The aspiration to turn Germany into a semiconductor superpower, described by insiders as personally driven by Scholz, now looks increasingly hopeless. Aides insist he will stick with it despite Intel's plant halt announcement. (BBG)
Money managers are turning increasingly bullish on oil to start 2025 as technical signals prompt algorithmic traders to dump short positions and hedge funds position for sanctions and inflation in a second Trump term. (BBG)
Alberta’s government plans to directly dedicate barrels of oil for new pipeline projects in a bid to accelerate the expansion of production in the western Canadian province. (BBG)
Bridgewater Associates dismissed 7% of its workforce Monday as the world’s biggest hedge fund seeks to remain lean and maintain the flexibility to hire top talent. (BBG)

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GEOPOLITICS:

U.S. Treasury Secretary Yellen met virtually on Monday with Chinese Vice Premier He Lifeng and raised concerns about "malicious cyber activity" carried out by Chinese state-sponsored actors. (RTRS)
Iranian forces have largely withdrawn from Syria following the Assad regime’s December collapse, according to U.S., European and Arab officials, in a significant blow to Tehran’s strategy for projecting power in the Middle East. (WSJ)

EQUITIES:

Nvidia CEO Huang, in his CES keynote speech, touted inroads in AI agents, self-driving cars and robotics. Also announced the new RTX 50 chip series, built on Blackwell architecture and using Micron memory chips. (Newswires)
Meta Platforms said Monday that UFC President Dana White is among three new members of its board of directors. (WSJ)
Apple is stepping up plans to expand its News app, considering adding new countries to the platform. (FT)
US bitcoin miners are accumulating war chests of the cryptocurrency to help them withstand tightening margins as competition for resources intensifies. (FT)
Phillips 66 said it would buy EPIC NGL for $2.2 billion in a deal to help the Houston oil refiner grow its Permian midstream business. (WSJ)
Ulta Beauty reported stronger-than-expected holiday performance, modest Q4 comparable sales growth, and sees Q4 operating margins exceeding the prior 11.6-12.4% guidance range. (Newsquawk)
Tesla supplier Panasonic Energy plans to eliminate its supply-chain dependence on China for EV batteries made in the US, a senior executive told Reuters, calling the shift a "No.1 objective". (RTRS)
Nippon Steel CEO has warned that tariffs alone would not create a stronger American steel industry, as he pursued legal action aimed at persuading Trump to launch another review of his proposed $15bn deal to buy US Steel. (FT)
KKR is considering selling Japanese supermarket chain Seiyu in a deal that could worth several hundred billion yen (several billion dollars). (Nikkei)
Toyota Motor Corp. is investing in a Japanese startup that aims to mass produce lightweight rockets and someday vie with big players for a slice of the growing commercial space industry. (BBG)
SMIC has slashed prices by 40% on 28nm chip manufacturing to USD 1,500 per wafer (12-inch/300mm) from USD 2,500 previously, according to local press, the price is half the USD 3,000 Taiwan’s chip foundries charge. (UDN)
Zijin Mining Group Co. aims to start producing lithium in the Democratic Republic of Congo early next year from one of the world’s largest deposits of the battery metal. (BBG)
WuXi Bio agreed to sell an overseas vaccine facility to Merck & Co. for half a billion dollars. (WSJ)
Mercedes Benz could soon abandon its ambitious profitability targets, according to Handelsblatt; an exec said that the 14% operating margin target is no longer "realistic", and does not see it as achievable. (Newsquawk)
British clothing retailer Next edged up its annual profit outlook for the fourth time in six months on Tuesday as it reported a better-than-expected 6.0% rise in full-price sales for the nine weeks to Dec. 28. (RTRS)
The Nigerian company that took over the local operation of ExxonMobil, London-listed Seplat, wants to double production to 120k BPD within six months, after moving in to take advantage of the retreat of foreign majors from the county’s onshore oil sector. (FT)