1. Treasuries Slump With Dollar Amid Stimulus Bets
Treasuries slid alongside the dollar amid speculation that Washington lawmakers will make progress on talks for stimulus legislation to be financed by trillion-dollar borrowing. U.S. stocks were little changed. The U.S. 10-year treasury yield broke above 0.8% to the highest since June and European yields also rose after Democratic House Speaker Nancy Pelosi expressed hope for political compromise on a bill this week. The S&P 500 fluctuated. Netflix Inc. tumbled after missing subscriber estimates. Tesla Inc. was mixed before financial results later Wednesday, and social-media company Snapchat soared after an earnings beat. European stocks slumped for a third day.
The S&P 500 Index fell less than 0.1% as of early morning New York time.
The Stoxx Europe 600 Index decreased 0.9%.
The MSCI Asia Pacific Index rose 0.7%.
2. IMF cuts Asia’s growth forecast, warns of pandemic-driven risks
The International Monetary Fund slashed this year’s economic forecast for Asia, reflecting a sharper-than-expected contraction in countries like India, a sign the coronavirus pandemic continues to take a heavy toll on the region. While the IMF upgraded next year’s growth forecast, it warned the recovery will be sluggish and patchy with countries dependent on tourism seen taking a particularly hard hit.
The IMF said it expects Asia’s economy to contract 2.2% this year. That decline is 0.6% higher than its forecast in June, due to sharp slumps in countries like India, the Philippines and Malaysia. India’s economy is likely to shrink 10.3% this year in stark contrast to China, which is set to expand 1.9%.
3. EU to UK on Brexit talks: ‘You can’t have cake, eat it too’
The European Union took a defiant tone on Wednesday as the standoff over resuming post-Brexit trade negotiations with the United Kingdom intensified, telling London that “you cannot have your cake and eat it too.” European Council President Charles Michel refused to bow to British insistence for the EU to fundamentally change its negotiating stance and cede more to U.K. demands. Michel said instead that if Britain wants vast access to the 27-member bloc’s markets, it will equally have to keep its waters open to EU fishermen, something the UK government has said it doesn’t want to do.
4. China urges Sweden to reverse its Huawei, ZTE ban to avoid backlash on Swedish companies in China
Sweden should reverse its ban on Chinese telecommunications companies Huawei and ZTE from a planned 5G spectrum auction to avoid a “negative impact” on its own companies, said China’s foreign ministry. “China expresses strong dissatisfaction with Sweden,” said foreign ministry spokesman Zhao Lijian, speaking at a regular news briefing in Beijing on Wednesday.
“Sweden should uphold an objective and fair attitude, and correct its wrong decision, to avoid bringing a negative impact to China-Sweden economic and trade cooperation and the operations of Swedish enterprises in China,” said Zhao.
5. UK borrowing exceeds forecasts, debt highest since 1960
Britain’s government borrowing exceeded forecasts in September and over the first half of the financial year was more than six times higher than a year earlier, due to the huge cost of the coronavirus pandemic. Public sector net borrowing totalled 36 billion pounds (3.5 lakh cr INR) last month.Driven by a surge in coronavirus-related spending and a fall in tax revenue after the biggest economic hit since at least the 1920s, borrowing in the first half of the financial year broke through the roof.
6. Australian watchdog considers its own Google antitrust case after US sues search giant
Australia’s competition watchdog will consider its own antitrust case against Google, the commission chairman said Wednesday after the U.S. Justice Department sued the company for abusing its dominance in online search and advertising. Sims is drafting legislation to address the imbalance in bargaining power between Google and the Australian media businesses that want the tech giant to pay for journalism. The bills, that will be ready to be introduced to Parliament by December, would empower an arbitrator to make binding decisions on how much Google and Facebook must pay media companies for news content.
Google has said the proposed laws would result in “dramatically worse Google Search and YouTube,” put free services at risk and could lead to users’ data “being handed over to big news businesses.” Facebook has warned it might block Australian news content rather than pay for it.
7. Dubai leads major Gulf markets higher in early trade
Most major Gulf stock markets were in positive territory early on Wednesday, led by financial stocks, with Dubai’s index boosted by gains in DAMAC Properties. Dubai’s main share index rose 0.7%, buoyed by a 14.4% surge in DAMAC Properties as investors hunted for bargains. There has been speculation about possible plans to take the company private but no final decision has been taken yet. Saudi Arabia’s benchmark index gained 0.3%, with Al Rajhi Bank rising 0.6% and petrochemical firm Saudi Basic Industries increasing 0.7%.
8. Israel, UAE agree to visa-free travel as ties deepen
Israel and the United Arab Emirates agreed to visa-free travel on Monday, an unprecedented arrangement between Israel and an Arab state, signed as the first ever official UAE delegation landed in Tel Aviv. The visit, hailed as a “glorious day for peace” by Prime Minister Benjamin Netanyahu, came after Israel and the UAE agreed to normalise ties in a deal inked at the White House last month. With their economies hard-hit by the coronavirus pandemic, the UAE and Israel are hoping for rapid dividends from the normalisation deal – which broke years of Arab consensus that there should be no relations with the Jewish state until it makes peace with the Palestinians.
9. Jack Ma’s Ant Receives China Approval for IPO in Shanghai
Jack Ma’s Ant Group got the green light from China’s securities watchdog for its initial public offering in Shanghai, clearing another hurdle as the Chinese fintech giant tries to complete its share sale before the U.S. election. China’s securities regulator approved the listing on Shanghai’s STAR market. Ant is said to have earlier won approval from the Hong Kong stock exchange for an IPO. Ant is seeking to raise $35 billion in a dual listing, with about half coming in Hong Kong and the other half in Shanghai. Ant’s IPO could be the world’s biggest, surpassing Saudi Aramco’s record $29 billion sale last year.
10. China Will Likely See Positive Economic Growth for 2020
China will likely post positive economic growth for the full year and the debt-to-GDP ratio is expected to stabilize in 2021 after debt climbed in the wake of the coronavirus pandemic, the Chinese central bank governor said. Data this week showed GDP rose 4.9% in the third quarter from a year ago, putting China in line to be the only major economy to expand this year after bringing the pandemic under control. At the same time, debt has climbed, reaching 269.2% of GDP last quarter. The macro leverage ratio — the percentage of debt in households, non-financial enterprises and governments to total gross domestic product — “has increased this year due to the fight against the pandemic.”