Houthis threaten Saudi oil facilities once again; DXY flat await US CPI - Newsquawk US Market Open

US President Trump said he will make a decision on Iran very soon; Israeli PM Netanyahu and Trump reportedly discussed launching a major new operation against Iran before the US and Israeli elections.
Yemeni Army said operations towards Saudi airports and oil facilities will continue and urged civilians, workers and shipping companies to evacuate airports and firms.
US equity futures mixed; ASML gains on an upbeat Q3 report and raised guidance.
DXY flat; Antipodeans outperform following strong Chinese trade data.
Fixed income benchmarks climb, led by Gilts on pre-budget reports.
Looking ahead, highlights include US Inflation (Sep). Speakers include Fed’s Barkin, ECB's Schnabel. Earnings from Bank of America, BlackRock, Morgan Stanley, Progressive & State Street.

SNAPSHOT

EUROPEAN TRADE

EQUITIES

European bourses (STOXX 600 +0.6%) are firmer across the board, with outperformance in the AEX (+0.9%), following positive ASML (+1.6%) earnings. The Co. reported Q3 top- and bottom-line beats, while also lifting its Q4 and FY guidance. In the prepared remarks, the CEO highlighted that the planned supply for 2027 and 2028 will not fully meet the demand and are looking at ways to increase capacity for 2028 beyond the 30% increase previously communicated.
Sectors highlight the positive bias. Real Estate tops the sector pile, with Tech and Consumer Products & Services following closely behind. The sector laggards include Autos, Insurance and Banks.
US equity futures are broadly firmer, with the NQ flat. More bank earnings to report, with BofA on deck. Outside of earnings, US CPI is expected to tick higher to 3.6% (prev. 3.4%). Pointing to UST positioning, traders are short with BofA FMS pointing to this being a crowded trade. A dovish surprise could see a large unwind of this positioning and can also support the equity space.
ASML (ASML NA) Q3 2026 (EUR): Basic EPS 12.95 (exp. 10.68), Revenue 11.66bln (exp. 11.58bln). Q4 guidance: Net Sales 14.2-15.2bln (exp. 14bln). FY guidance: Total net sales 44-45bln (exp. 43.6bln, prev. guided 43-45bln).
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FX

DXY was initially under mild pressure following on from the dovish remarks from Fed’s Williams and as crude benchmarks moved lower in early morning trade. However, a bounce back in oil prices and hawkish commentary from the Houthis has allowed the index to sit around the unchanged mark, within a 102.07 to 102.23 range. To recap that announcement, the group warned that it will continue operations towards Saudi airports/oil facilities in the coming days; it also warned global shipping companies.
G10s are mixed against the USD, vs initial gains across all majors early doors. The Antipodeans remain the outperformers, on the back of stronger-than-expected Chinese Export data, and with Chinese CPI Y/Y rising from the prior, albeit less than expected. The broader positive risk tone across markets is also facilitating the strength in Antipodeans today. Typical havens (CHF and JPY) are the slight underperformers this morning, given the broader risk tone.
GBP and EUR are both essentially flat. For the former, UK press have been boosting their coverage ahead of the Autumn Budget (Oct 28th). The Times reported that UK Chancellor Healey is expected to pay for new giveaways in this month's budget, with higher taxes or spending cuts rather than more borrowing. This will offer investors some confidence on the fiscal side of things. Elsewhere, UK Chancellor Healey is to target online marketplaces in a GBP 1bln tax crackdown, in which the UK plans to make them responsible for collecting tax owed by retailers selling on their platforms.

FIXED INCOME

USTs are firmer, but only modestly so, in a bit of a holding pattern ahead of US CPI this afternoon, which will be scoured for insight into near-term Fed bets. A cool print could add to the dovish move seen after the September NFP report, and thus further push back on end-2026 tightening bets. Conversely, a hot series would likely see that NFP-driven move unwind. As it stands, that sees USTs three ticks firmer in 104-22 to 104-29+ confines, while yields are lower across the curve with the short-end leading the downside currently.
EGBs are in fitting, with no real reaction to the energy developments thus far. Instead, the bloc is focused on the fiscal front, as France’s Le Pen speaks later and is expected to once again push back on the level of French contribution to the EU budget. Elsewhere, confrontation is expected between Spanish PM Sanchez and Italian PM Meloni, according to Politico, on the migration situation.
Bunds similarly bid by about 10 ticks, in narrow confines. More generally, the OAT-Bund 10yr yield spread is holding at 137bps and is modestly narrower on the session vs a c. 140bps start. While the BTP-Bund equivalent is around 108bps, and slightly wider as it stands.
Finally, Gilts see relative outperformance today, supported by the FT report that Chancellor Healey’s fiscal giveaways will be funded via taxation and/or spending cuts, rather than via more borrowing. Additionally, BoE Chief Economist Pill pushed back on the extent of market pricing for hikes by end-2027; however, his commentary was more pragmatic on the data-dependent and uncertainty points, rather than a complete dovish reassessment from the known hawk. Firmer by 50 ticks at best, hitting an 84.37 peak, but around 10 ticks shy of Tuesday's best as things stand.
Germany sells EUR 1.882bln vs Exp. EUR 2.5bln 3.40% 2047 and 2.90% 2056 Bund.
The UK sells GBP 5bln 4.625% 2030 Gilt: b/c 3.41x (prev. 3.24x), average yield 4.945% (prev. 4.786%), tail 0.2bps (prev. 0.3bps).
Japan sells JPY 1.9tln 5-year JGBs; b/c 3.56x (prev. 3.42x), average yield 2.379% (prev. 2.239%), Tail in price 0.02 (prev. 0.04).

COMMODITIES

WTI Nov and Brent Dec futures are currently flat/mildly firmer, in what has been a volatile session for the complex. Overnight strength was facilitated by ongoing uncertainty related to the Strait of Hormuz; thereafter, the complex came under mild pressure, but lacked a clear driver. Some modest upticks were then seen after the Houthis warned that further operations against Saudi airports/oil facilities could happen in the coming days. Iranian press then reported that a tanker was sunk in the Strait of Hormuz after hitting a mine; a report which failed to lift prices any further.
As it stands, WTI and Brent are holding towards the bottom end of their respective USD 93.97-95.41/bbl and USD 105.21-107.15/bbl ranges.
Dutch TTF is also firmer but off its best level amid the aforementioned Middle Eastern tensions, with winter conditions underpinning demand at a time supply remains uncertain. TTF has fallen from a EUR 87.44/MWh high to sub-EUR 86.00/MWh at the time of writing, but remains well above its USD 84/MWh low.
Precious metals are subdued, with spot gold posting mild losses, given the broadly positive risk tone. The yellow metal will await US CPI for further direction; it currently trades within a USD 4,141-4,170/oz range.
Base metals are firmer, with copper benefiting from renewed Chinese demand and stronger-than-expected trade data, alongside the broader recovery in Asian technology stocks. Chinese exports (USD) rose 36.3% Y/Y (exp. 25.5%), while imports increased 31% (exp. 24.5%), although factory-gate inflation accelerated to 5.0% Y/Y (exp. 4.5%). Some mild pressure was seen in Copper after BHP’s Escondida mine reached a prelim agreement with its union, to avoid a strike.
US President Trump said they are going to announce two deals today and stated every permit needed has been granted regarding Alaska LNG, while Trump then stated that Taiwan has agreed to buy 30% of gas coming off Alaska pipeline and is to invest USD 4.4 billion in the project, on top of the USD 50bln South Korea committed to invest. Trump later posted that "Massive Oil, Gas, and Mineral Exploration is getting ready to begin in our new and beautiful Greenland!"
IEA OMR (Oct): Sees world oil demand falling by 2.6mln BPD in 2026 on Iran war disruption and rising prices (prev. 2.5mln BPD drop).
BHP's (BHP AT) Escondida mine has reportedly reached a preliminary agreement with Supervisor's Union and is to be ratified by members, with a strike being avoided, according to sources.
Japan's aluminium premium for Oct-Dec delivery set at USD 255/t, -35% Q/Q, according to sources.

TRADE/TARIFFS

UK Business Secretary said the UK will not put tariffs on Chinese vehicles and he will not change trade rules due to EU pressure, according to The Guardian.
Germany is reportedly set to push the EU to impose caps on additional Chinese imports, according to Bloomberg.
China bought 8-10 cargoes of US soybeans for December shipment, according to traders.

NOTABLE EUROPEAN HEADLINES

UK Chancellor Healey is to target online marketplaces in a GBP 1bln tax crackdown, in which the UK plans to make them responsible for collecting tax owed by retailers selling on their platforms, according to The Times.
UK Chancellor Healey is expected to pay for new giveaways in this month's budget, with higher taxes or spending cuts rather than more borrowing, according to FT
UK Chancellor Healey is reportedly making plans to cut the cost of hiring under-25-year-olds at the UK Budget, according to CityAM citing sources.
The EU Commission proposed a one-year delay to the implementation of specific provisions of the EU Methane Regulation related to importers.
French National Rally (RN) leader Le Pen sees the extraordinary political events of late-2026 and 2027 as ushering in significant European change, the FT reported. The report added that Le Pen thinks EU Commission President von der Leyen no longer has the confidence of many EU governments and describes the EU attempt to agree a seven-year budget before the French Presidential election as "deeply objectionable". Furthermore, Le Pen has the "will and conviction" to cut France's contribution to the EU budget, adding that the heavy European debt burden is more of a concern than any French-EU clash over fiscal contributions. To end, Le Pen added that she wants the ECB to be able to finance borrowing for priorities such as defence and the energy transition.
Spanish PM Sanchez is expected to hold an "intense" debate at the European Council over migration, Politico reported citing sources, Sanchez expected to be combative with Italian PM Meloni on the issue.
Italian PM Meloni said they see a deal with the EU being close on measures to cut the impact of gas costs on electricity prices.

NOTABLE EUROPEAN DATA RECAP

German Wholesale Prices (Sep YY) 8.7% (Prev. 6.8%).
German Wholesale Prices (Sep MM) 1.9% vs. Exp. 0.7% (Prev. 0.9%).
Spanish HICP Final (Sep YY) 5.0% vs. Exp. 5% (Prev. 4.6%).
Spanish HICP Final (Sep MM) 0.6% vs. Exp. 0.6% (Prev. 0.7%).
Swedish CPIF Final (Sep YY) 1.5% vs. Exp. 1.5% (Prev. 0.7%).
Swedish CPIF Final (Sep MM) 0.9% vs. Exp. 0.9% (Prev. -0.3%).

CENTRAL BANKS

Fed's Collins (2028 voter) said tightening monetary policy will help return inflation to 2%, and she expects the Fed to raise interest rates 'a bit further' by the end of the year, while she expects inflation to stay above 2% due to high energy prices. Furthermore, she supported the Fed raising rates at the September meeting and stated the future path of monetary policy in the new year will depend on data.
ECB's Lagarde said inflation has been rising predominantly, but not exclusively as a result of energy prices, while she noted that they are not seeing any second-round effects yet and they cannot wait until they are in full view, but can anticipate and look for hints. Furthermore, she responded that the primary and first solution lies in French fiscal policy when asked about French debt, and stated that growth is not brilliant, but 1.1% growth in 2026 is not bad.
ECB's Wunsch said they are probably going to have to hike again, but he's not making any bets because they have so much uncertainty on the energy front and maybe also in AI, according to Bloomberg.
ECB's Moulin said inflation is mainly due to conflict in the Middle East and energy-related, while he added that inflation expectations by corporates and households in the medium term are well anchored. Moulin also stated that a rise in yields may affect demand and prompt a more moderate response to an inflation shock.
BoE Governor Bailey said UK companies are focusing intensely on containing costs amid surging energy prices caused by the Iran war, while he reiterated that broader UK inflation pressure from the energy shock has remained subdued so far.
BoE Chief Economist Pill said he is somewhat more sceptical of market pricing for four rate hikes over the next year.
Monetary Authority of Singapore kept its FX-based policy settings unchanged, with the rate of appreciation of the policy band maintained (exp. very slight tightening), while it made no changes to the width and level the band is centred. MAS said Singapore's economy is expected to continue expanding steadily in the quarters ahead and core inflation should remain slightly elevated in the immediate quarters ahead, but is projected to ease discernibly from the middle of next year.

NOTABLE US HEADLINES

Fed Governor Cook's lawyer denounced the Trump administration's new investigation and said she will not be able to attend the hearing on November 5th, according to The New York Times.
Anthropic is to disclose new revenue numbers at pre-IPO investor day today, CNBC reported citing sources.

GEOPOLITICS

MIDDLE EAST

US President Trump said during a rally in Alaska that they've been taking more oil out of the Strait of Hormuz than before the war, while he reiterated that the war with Iran will end soon and that Iran will not possess a nuclear weapon. Trump also commented "Wait and see what we do to Iran. We're going to hit them hard. Wait and see what we do to Iran, because we've had enough".
US Central Command rejected a claim by the IRGC Navy Commander that the Strait of Hormuz is under Iranian control and that any approaching US warships would be sunk, while it stated that "IRGC's navy commander has no navy. American forces and regional partners clearly control the Strait of Hormuz. Just yesterday US forces assisted Gulf partners in shipping more than 19mln barrels of crude oil through the strait."
A source told the Tehran Times that the assessment is that the US President Trump, under pressure from Israeli President Netanyahu, is seeking a new confrontation in the region, but does not have the capacity to expand or sustain this.
Iran is reportedly shifting tactics to step up attacks on shipping ahead of US midterms, according to two Iranian officials cited by Reuters.
IRGC Navy said that a container ship carrying 2,500 containers sank south of the Strait of Hormuz, Sepah News reported.
Iran and Oman Foreign Ministers held a call and discussed latest regional developments, including developments in Yemen, and examined ways to achieve peace and stability in the region.
Pakistan's Foreign Minister said they have discussed Bab el-Mandeb with Oman, further efforts need to be made to resolve the current situation.
Oman Foreign Ministry said that discussions with Iran on Hormuz have concluded, adding that the finalisation depends on US-Iran talks.
Yemeni Army Spokesperson said operations towards Saudi airports and oil facilities will continue in the coming days and warned for global shipping companies, civilians and workers to evacuate such airports and firms, as they are legitimate targets. The spokesperson confirmed that forces carried out a military operation targeting the Aramco company in Dhahran in the Eastern Province and King Khaled International Airport and the Aramco refinery in Riyadh with a large number of ballistic missiles.
Houthi official warned that Saudi oil and vital installations will be visited overnight.

RUSSIA-UKRAINE

UK PM Burnham will host Ukrainian President Zelensky in Downing Street on Wednesday as Ukraine and its allies scramble to respond to Trump's diesel deal with Putin, while Burnham will tell Zelensky that Britain's support is rock solid with faster delivery of lightweight, multi-role missiles to help Ukraine defend itself, according to Bloomberg.
A US official said the idea of cutting off intelligence-sharing with Ukraine is being discussed inside the White House, Semafor reported.
Russian air attack hit energy facilities in Ukraine's capital Kyiv, according to the mayor.

CRYPTO

Bitcoin has lacked a clear bias and trades in a USD 83.1k-84.06k range, as it remains contained within Tuesday's range.

APAC TRADE

APAC stocks were ultimately mixed as the region clawed back some of the recent tech-related losses, while participants also digested key releases from China, including inflation and trade figures.
ASX 200 declined with the index dragged lower by underperformance in the top-weighted financials sector, while sentiment amongst miners was not helped by the indecision in Rio Tinto following its quarterly production update.
Nikkei 225 reclaimed the 68,000 level as tech stocks got some reprieve from recent selling.
KOSPI was among the biggest gainers as tech rebounded from the recent underperformance.
Hang Seng and Shanghai Comp were flat as participants digested a slew of data, including stronger-than-expected trade figures and mixed inflation numbers in which CPI printed softer-than-expected, while PPI was hot and showed a faster-than-anticipated acceleration in factory gate prices.

NOTABLE ASIA-PAC HEADLINES

China's Customs Vice Minister said in the first three quarters, China's foreign trade has effectively dealt with various external shocks and China's foreign trade has kept good development momentum, while it has shown resilience despite rising international changes, risks and challenges. However, the official also stated that China's trade development still faces many challenges, and for full-year trade, there are many uncertainties globally, including geopolitical conflicts.

NOTABLE APAC DATA RECAP

Chinese Trade Balance (Sep) 133.53B vs. Exp. 118.1B (Prev. 119.09B).
Chinese Exports (Sep YY) 36.3% vs. Exp. 25.5% (Prev. 25%).
Chinese Imports (Sep YY) 31% vs. Exp. 24.5% (Prev. 28.2%).
Chinese CPI (Sep YY) 0.9% vs. Exp. 1% (Prev. 0.8%).
Chinese CPI (Sep MM) 0.2% vs. Exp. 0.3% (Prev. 0.4%).
Chinese PPI (Sep YY) 5.0% vs. Exp. 4.5% (Prev. 3.8%).
Chinese M2 Money Supply (Sept): 7.2% Y/Y (exp. 7.4%); YTD Aggregate Financing (CNY): 27.46tln (exp. 27.25tln); YTD New Yuan Loans (CNY): 11.52tln (exp. 11.47tln).