Crude

After the worst monthly performance since 2013 and the weakest close since February 2010, it appears "managed money" has piled in to the momentum trade. According to CFTC, hedge funds have never been more short gold (slashing long bets and increasing short beta by around 11 million ounces net in the last week). But gold is not alone as 15 of the 24 commodities tracked by CFTC showed sentiment swinging more bearish last week (with Brent and WTI also at their most-bearish positioning on record). And this is happening as November US Mint gold coin sales rose 86% YoY.

“We will listen, and then decide,” he said on Tuesday upon his arrival in Vienna, trying to tamp down speculation that the outcome is preordained. When asked if OPEC’s strategy of pursuing market share was working, al-Naimi was coy. “What strategy?” he said. “Who said we’re keeping market share?” Despite al-Naimi’s assurances that the Saudi delegation won’t dictate policy to OPEC, his voice is the only one that counts.

It is only logical that a day after the S&P500 surged, hitting Goldman's 2016 target of 2,100 more than a year early because the US manufacturing sector entered into a recession, that Europe would follow and when Eurostat reported an hour ago that European headline inflation of 0.1% missed expectations of a modest 0.2% increase (core rising 0.9% vs Exp. 1.1%), European stocks predictably surged not on any improvement to fundamentals of course, but simply because the EURUSD stumbled once more, sliding by 40 pips to a session low below the 1.06 level.

After nine weeks of inventory builds in a row, expectations were for a modest 900k barrel draw in total inventory this week. Expectations were crushed as API reported a much-larger 1.6 million barrel build - the 10th week in a row. After three weeks of very significant builds, Cushing - having seen its storage capacity increased to 73mm (from 71.4mm) barrels - saw a smaller-than-expectd 433k build (+1mm build exp.). WTI prices had drifted higher into the API report (after an extremely volatile day) but slipped lower after the print, as anxiety builds ahead of OPEC.

D'uh!

Who could have seen that coming? It appears, for America's northern brethren, low oil proces are unequivocally terrible. Against expectations of a flat 0.0% unchanged September, Canadian GDP plunged 0.5% - its largest MoM drop since March 2009 and the biggest miss since Dec 2008. With Canada's housing bubble bursting, it's time for the central planners to get back to work and re-invigorate the massive mal-invesment boom (and ban pawning of luxury goods).

There was something for everyone in last night's much anticipated Chinese PMI data, with the official number sliding to the lowest in over 3 years, suggesting the PBOC will need to do more stimulus and is thus bullish, while the unoffocial Caixin print rising to the highest since June, suggesting whatever the PBOC is doing is working, and is also bullish. Not unexpectedly, global stocks decided to take the bullish way out, and have risen across the globe led by Asia, where stocks rose as much as 1.8%, Europe also green and US equity futures up 10 points as of this writing.

Scott Sumner said he had a “modest” proposal: there should be a highly liquid futures market in Nominal Gross Domestic Product. Let's look at that.

"At the moment we have received additional information confirming that that oil from the deposits controlled by Islamic State militants enters Turkish territory on industrial scale."

The ISIS group sells most of its crude directly to independent traders at the wellhead for $20-$45 a barrel earning the group an average of $1.5 million a day.

Faced with a sharp deterioration in government finances, the Saudis have resorted to tapping the bond market and delaying contractor payments in an effort to avoid further depletion of the kingdom's SAMA reserves. Now, Saudi banks are bleeding private and public sector deposits, while interbank rates have spiked the most since 2008.