Stock Market Update

The S&P 500 futures currently trade 53 points above fair value.

Equity indices in the Asia-Pacific region ended the week on a mostly lower note while Japan's Nikkei (+2.1%) and South Korea's Kospi (+0.5%) hit fresh records. Japan's Finance Minister Katayama commented on the foreign exchange market, acknowledging that recent weakness in the yen is being watched with a "high sense of urgency." China has reportedly purchased more soybean shipments from the U.S. People's Bank of China Governor Pan said that the short-term rate corridor will be narrowed. Economic data released overnight included a deepening contraction in China's Manufacturing PMI (49.0) and ongoing standstill in the growth of the Services sector (50.1).

• In economic data:
  • China's October Manufacturing PMI 49.0 (expected 49.6; last 49.8) and Non-Manufacturing PMI 50.1, as expected (last 50.0)
  • Japan's October Tokyo CPI 2.8% yr/yr (last 2.5%) and Tokyo Core CPI 2.8% yr/yr (expected 2.6%; last 2.5%). September Industrial Production 2.2% m/m (expected 1.5%; last -1.5%). September Retail Sales 0.5% yr/yr (expected 0.8%; last -0.9%) and September Unemployment Rate 2.6% (expected 2.5%; last 2.6%). September Housing Starts -7.3% yr/yr (expected -7.8%; last -9.8%) and Construction Orders 34.7% yr/yr (last 38.9%).
  • South Korea's September Industrial Production -1.2% m/m (expected 0.1%; last 2.2%); 11.6% yr/yr (expected 5.9%; last 0.9%). September Retail Sales -0.1% m/m (last -2.4%)
  • Hong Kong's Q3 GDP 0.7% qtr/qtr (last 0.4%); 3.8% yr/yr (last 3.1%). September Retail Sales 5.9% yr/yr (last 3.8%)
  • Singapore's September Bank Lending SGD863.8 bln (last SGD851.7 bln). Q3 Business Expectations 8.00 (last 5.00)
  • Australia's September Private Sector Credit 0.6% m/m, as expected (last 0.6%). Q3 PPI 1.0% qtr/qtr (expected 0.8%; last 0.7%); 3.5% yr/yr (last 3.4%)

---Equity Markets--- 

• Japan's Nikkei: +2.1% 
• Hong Kong's Hang Seng: -1.4%
• China's Shanghai Composite: +0.7% 
• India's Sensex: -0.6% 
• South Korea's Kospi: +0.5% 
• Australia's ASX All Ordinaries: UNCH

Major European indices are on track for a mostly lower finish to the week while Italy's MIB (+0.3%) outperforms, revisiting this year's peak. The European Central Bank's latest Survey of Professional Forecasters showed an uptick in harmonized inflation expectations for 2025 to 2.1% from 2.0% while the GDP growth forecast was increased to 1.2% from 1.1%. The inflation forecast for 2026 remained at 1.8% while the growth forecast for next year stayed at 1.1%. Several ECB policymakers spoke about policy being in a good place after yesterday's decision to hold the rate corridor unchanged.

• In economic data:
  • Eurozone's October CPI 0.2% m/m (last 0.1%); 2.1% yr/yr, as expected (last 2.2%). October Core CPI 0.3% m/m (last 0.1%); 2.4% yr/yr (expected 2.3%; last 2.4%)
  • Germany's September Retail Sales 0.2% m/m, as expected (last -0.5%); 0.2% yr/yr (last -1.6%). September Import Price Index 0.2% m/m (expected -0.2%; last -0.5%); -1.0% yr/yr (last -1.5%).
  • U.K.'s October Nationwide HPI 0.3% m/m (expected 0.0%; last 0.5%); 2.4% yr/yr (expected 2.3%; last 2.2%)
  • France's October CPI 0.1% m/m, as expected (last -1.0%); 1.0% yr/yr (expected 1.1%; last 1.2%). September PPI -0.2% m/m (last -0.2%); 0.1% yr/yr (last 0.1%)
  • Italy's October CPI -0.3% m/m (expected 0.0%; last -0.2%); 1.2% yr/yr (expected 1.6%; last 1.6%)
  • Spain's August Current Account surplus EUR5.08 bln (last surplus of EUR6.27 bln)
  • Swiss September Retail Sales 1.5% yr/yr (expected 0.3%; last -0.4%)

---Equity Markets---

• STOXX Europe 600: -0.4%
• Germany's DAX: -0.5% 
• U.K.'s FTSE 100: -0.3% 
• France's CAC 40: -0.4% 
• Italy's FTSE MIB: +0.3%
• Spain's IBEX 35: -0.1%