US stocks were mixed with a slight positive bias and yields climbed following encouraging labour market metrics - Newsquawk Asia-Pac Market Open

• US stocks finished mixed, with the Russell posting notable gains while the Nasdaq underperformed, and the S&P 500 was roughly flat. Futures were supported briefly in pre-market trade on reports that Meta (META) is cutting 30% of its budget on Metaverse spending, which gave a boost to Meta shares and US indices as the tech giant puts more effort into AI. However, the move was only short-lived for the indices, but Meta still closed with gains of c. 3.5%. Focus then turned to US data, which showed a slowdown both in challenger layoffs and in the total non-farm payroll losses M/M reported by RevelioLabs. There was also a minor M/M improvement on the Chicago Fed unemployment rate estimate for November. Meanwhile, both initial and continued jobless claims came in below all analyst forecasts, helping ease some recent labour market concerns.
• USD was firmer as EUR and CHF selling more than offset the gains in JPY, while participants digested several data releases, which were ultimately mixed, although there was a larger-than-expected drop in the weekly claims report in which both Initial and Continued Claims printed beneath analysts’ forecast range, with the former at the lowest since September 2022.
• Looking ahead, highlights include Japanese Household Spending & Leading Index, Philippines CPI, Singapore Retail Sales, RBI Rate Decision, Supply from Australia.

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LOOKING AHEAD

• Highlights include Japanese Household Spending & Leading Index, Philippines CPI, Singapore Retail Sales, RBI Rate Decision, Supply from Australia.
• Click for the Newsquawk Week Ahead.

US TRADE

• US stocks finished mixed, with the Russell posting notable gains while the Nasdaq underperformed, and the S&P 500 was roughly flat. Futures were supported briefly in pre-market trade on reports that Meta (META) is cutting 30% of its budget on Metaverse spending, which gave a boost to Meta shares and US indices as the tech giant puts more effort into AI. However, the move was only short-lived for the indices, but Meta still closed with gains of c. 3.5%. Focus then turned to US data, which showed a slowdown both in challenger layoffs and in the total non-farm payroll losses M/M reported by RevelioLabs. There was also a minor M/M improvement on the Chicago Fed unemployment rate estimate for November. Meanwhile, both initial and continued jobless claims came in below all analyst forecasts, helping ease some recent labour market concerns.
• SPX +0.11% at 6,857, NDX -0.10% at 25,582, DJI -0.07% at 47,851, RUT +0.76% at 2,531.
• Click here for a detailed summary.

TARIFFS/TRADE

• US President Trump is to talk trade with Mexico and Canada in Washington DC on Friday, according to CBS. This follows reports that Canadian PM Carney is to have brief meetings with US President Trump and Mexican President Sheinbaum at the World Cup draw on Friday, while Canada's Trade Minister LeBlanc had earlier commented that Carney doesn't plan to talk trade with Trump at the FIFA event.
• USTR Greer said President Trump could decide to pull out of the USMCA in 2026 and said "...that's always a scenario", while he added that Trump "only wants deals that are a good deal".
• US senators seek to block NVIDIA (NVDA) sales of advanced chips to China for 30 months and would target NVIDIA's H200 and Blackwell chips, according to FT. It was separately reported that a bipartisan group of US senators, including prominent China hawk Cotton, unveiled a bill that would block the Trump administration from loosening rules that restrict Beijing's access to artificial intelligence chips for 2.5 years, according to Reuters.
• US trade delegation is likely to visit Delhi, India for talks next week, according to Reuters sources.
• India's Trade Minister said exports of autos, electronic goods, textiles and machinery to Russia are expected to increase, while India aims to expand and diversify exports to Russia to address the trade imbalances.
• European Commission started a review of anti-subsidy tariffs on Volkswagen (VOW3 GY) E-Vehicles built in China. It was previously reported that Volkswagen is expected to secure a deal with the EU to replace EU anti-subsidy duties on China-made EVs with a minimum import price system.

NOTABLE HEADLINES

• US House Speaker Johnson told Punchbowl's Sherman that he intends to finalise a healthcare bill early next week, to have it on the floor before the end of 2025.

DATA RECAP

• US Factory Orders MM (Sep) 0.2% vs. Exp. 0.5% (Prev. 1.4%, Rev. 1.3%)
• US Initial Jobless Claims w/e 191.0k vs. Exp. 220.0k (Prev. 216.0k, Rev. 218k)
• US Continued Jobless Claims w/e 1.939M vs. Exp. 1.961M (Prev. 1.96M, Rev. 1.943M)
• US Challenger Layoffs (Nov) 71.321k (Prev. 153.07k)
• RevelioLabs Total Nonfarm Payrolls (Nov): -9.0k (prev. -9.1k, revised -15.5k)

FX

• USD was firmer as EUR and CHF selling more than offset the gains in JPY, while participants digested several data releases, which were ultimately mixed, although there was a larger-than-expected drop in the weekly claims report in which both Initial and Continued Claims printed beneath analysts’ forecast range, with the former at the lowest since September 2022.
• EUR gave up ground to the firmer buck, while better-than-expected Retail Sales did little to prop up the single currency.
• GBP was lacklustre with the currency not helped by the notable deterioration in the latest UK Construction PMI data.
• JPY was firmer after recent source reports pointed to a December BoJ rate hike with key members of Japanese PM Takaichi's government seen to not attempt to prevent such a move.

FIXED INCOME

• T-notes were sold on US labour market data and hawkish BoJ reports ahead of supply next week.

COMMODITIES

• Oil prices continued to pare the downside seen earlier this week from when US officials met with Russian President Putin.
• Saudi Arabia set January Arab light crude OSP to Asia at + USD 0.60/bbl (exp. 0.60-0.70/bbl, prev. 1.0/bbl) against Oman/Dubai average, while its set the OSP to NW Europe at ICE Brent + USD 0.05/bbl and to the US at ASCI + USD 2.50/bbl, according to Reuters citing a pricing document.
• Kazakhstan's oil and gas output declined by 6% in the first two days of December after drone attacks on the CPC black sea terminal.
• Russian Black Sea port oil exports fell behind schedule in November due to poor weather and drone activity.
• Russian President Putin said energy cooperation with India is unaffected by current conditions, fleeting political swings or tragic events in Ukraine and that 90% of India and Russia transactions are conducted in national currencies. Putin also said there was a certain decline in overall trade turnover during the first 9 months of the year, but commented that trade of Russian oil for consumers is running smoothly in India and that if the US has the right to buy Russian fuel, then why shouldn't India have the same privilege.

GEOPOLITICAL

RUSSIA-UKRAINE

• Russian Foreign Ministry spokeswoman Zakharova said a Ukrainian weapons factory in Denmark poses risks of further escalation.
• Russian Foreign Ministry said any illegal action in relation to Russian assets will lead to the harshest reaction, and that Russia is already preparing a response.
• German Chancellor Merz is to visit Belgium on Friday, in an attempt to convince Belgium to drop its opposition to the use of frozen Russian assets for a Ukraine reparation loan.
• Germany’s Defence Minister said the key to peace in Ukraine lies with Russia, but added that Russia is not willing to make peace.
• French President Macron reportedly said to European leaders that “There is a possibility that the U.S. will betray Ukraine on the issue of territory without clarity on security guarantees”, according to Der Spiegel.

OTHER

• US issued a travel alert for Venezuela and called on US citizens to leave the country immediately, while it stated that "Americans are advised not to travel to or remain in Venezuela due to the high risk of unjust detention, torture in detention, terrorism, kidnapping, arbitrary enforcement of local laws, crime, civil unrest, and poor health infrastructure".

ASIA-PAC

NOTABLE HEADLINES

• BoJ is carrying out an assessment of the level of the neutral interest rate, according to JiJi.
• Key members of Japanese PM Takaichi's government would not try to prevent a BoJ hike in December, according to Bloomberg citing sources.
• Japan weighs fiscal 2026 start for departure tax hike, in which it is considering a proposal to raise the departure tax from JPY 1,000 to 3,000 from FY26 and a possible hike to JPY 5,000 for travellers in business class and above.
• China reportedly gave its most forceful signal since 2022 to slow yuan gains, according to Bloomberg. It was separately reported that Chinese state-owned banks bought USD on the onshore spot market this week in a bid to rein in CNY strength, according to Reuters sources.

EU/UK

NOTABLE HEADLINES

• BoE Decision Maker Panel Survey (Nov) stated that expectations for year-ahead CPI inflation remained unchanged at 3.4%, while the expected year-ahead wage growth rose slightly, by 0.1ppt to 3.8% in the three months to November.

DATA RECAP

• UK S&P Global PMI Composite (Nov) 50.1 (Prev. 51.4)
• UK S&P Global Construction PMI (Nov) 39.4 (Prev. 44.1)
• French HCOB Construction PMI (Nov) 43.6 (Prev. 39.8)
• Italian HCOB Construction PMI (Nov) 48.2 (Prev. 50.7)
• German HCOB Construction PMI (Nov) 45.2 (Prev. 42.8)
• EU HCOB Construction PMI (Nov) 45.4 (Prev. 44)
• EU Retail Sales YY (Oct) 1.5% vs. Exp. 1.3% (Prev. 1.0%, Rev. 1.2%)