I. Yesterday’s News
International News

1. Four of the world's top central bankers promised on Tuesday to keep openly guiding investors about future policy moves as they slowly withdraw the huge monetary stimulus rolled out during the financial crisis. To do this, words will be key, the heads of the four central banks told an ECB conference on communication. Fed Chair Janet Yellen agreed with Draghi that guidance has been beneficial "on balance" but stressed it should always be viewed as depending on how the economy actually develops.

2. The Federal Reserve should keep its benchmark interest rate at current levels until there is an upswing in inflation, St. Louis Fed President James Bullard said on Tuesday. "Inflation data during 2017 have surprised to the downside and call into question the idea that U.S. inflation is reliably returning toward target," Bullard said in a speech during an appearance in Louisville, Kentucky. He added that even if the Fed does manage to return inflation to its 2 percent inflation target, it would not happen before 2018 or 2019. Bullard has repeatedly said raising interest rates again in such an environment risks harming the economy. President of the Federal Reserve Bank of Atlantic Raphael Bostic said on Tuesday he still backs a December interest-rate hike and that he would need to see further weakness in U.S. inflation and local signs of economic weakness to cause him to shelve expectations for gradual policy tightening. Robert Kaplan, President of the Federal Reserve Bank of Dallas, said he is “actively considering” backing another increase in short-term interest rates at the central bank’s meeting next month.

3. U.S. producer prices rose more than expected in October, driven by a surge in the cost of services, leading to the biggest annual increase in wholesale inflation in over 5-1/2 years. Tuesday's report from the Labor Department also showed steady gains in underlying producer prices, which support expectations of a gradual increase in inflation and keep the Federal Reserve on track to raise interest rates in December. The producer price index for final demand increased 0.4 percent last month after a similar gain in September. In the 12 months through October, the PPI jumped 2.8 percent, the largest increase since February 2012. The dollar pared losses against a basket of currencies after the data, while prices for U.S. Treasuries fell.

4. The euro zone's annual economic growth rate outstripped that of the United States in the third quarter setting up 2017 as the best year for the currency area since financial markets crashed a decade ago. Eurostat, the European Union statistics office, confirmed a preliminary estimate that euro zone gross domestic product (GDP) grew 0.6 percent from July to September from the previous quarter and on a year on year basis was 2.5 percent higher. The strong euro zone growth was powered by the biggest economy Germany, which shifted into an even higher gear in the third quarter, propelled by buoyant exports and rising company investments in equipment. Partly as a result of the growth, euro zone investments have turned in one of their best years since the single currency was born in 1999, confounding many who had bet on the bloc to be the disaster play of 2017. British inflation unexpectedly held steady at September's five-and-a-half-year high of 3.0 percent in October, wrong-footing the Bank of England and raising fresh questions about how fast the central bank will follow up on this month's interest rate hike. Sterling fell against the dollar and British government bond prices rose as markets lengthened the odds slightly on a new BoE rate hike in the foreseeable future.

Domestic News

5. China will stick to his policy stance despite some short-term fluctuations after the National Bureau of Statistics (NBS) showed growth of factory output, investment and consumption in October all slowed a notch from the previous month. China’s economic growth will easily meet or beat the government’s full-year target of around 6.5 percent. Citing rising pressure in the fourth quarter, China  is on a steady track on deleveraging and tightening supervision of macro economy. Year-end liquidity is expected to remain tight balance.

6. Money supply in China last month rose by the slowest on record due to disappointing financial data in October and slower growth in social financing. In the meanwhile, new yuan loans nearly halved from September amid the government's tight regulations and seasonal liquidity stress. Despite of slower growth in funding to the real economy, higher-than-expected inflation, rising commodity prices and ongoing risk prevention and deleveraging made it hard to loose monetary policy.

7. China proposes the formulation of a vision for strategic partnership between China and the Association of Southeast Asian Nations (ASEAN) to upgrade cooperation, facilitate trade and investment, expand local currency settlement, and promote the development of bond market in local currency, Chinese Premier Li Keqiang said. China will also set up a 10 billion yuan China-ASEAN loan to support cooperation projects.

II. Market Overview
FX
1. Global Market

The euro rose to a 2-1/2 week high against the U.S. dollar on Tuesday and was on track for its largest percentage gain in more than four months, after data showed Germany's economy shifted into a higher gear in the third quarter. The euro was up 1.11 percent at $1.1794. The dollar index, which tracks the greenback against six major currencies, was down 0.7 percent at 93.828. The euro was up 0.74 percent against sterling.

2. Home Market

China's yuan tracked the official midpoints against the U.S. dollar that slipped to a two-week low, after a slightly higher opening. Forex-buying demand came out stronger after data showed growth of factory output, investment and consumption all slowed a notch from the previous month. Yuan is expected to remain within current range in the near term due to market divergence.

Precious Metals

Gold rose slightly on Tuesday, as a weakening U.S. dollar and sluggish stock market helped pull the precious metal off a one-week low hit in early trade, while traders also said uncertainty over the fate of a U.S. tax cut prompted some safe-haven buying of gold. Spot gold was up 0.23 percent at $1,280.63 per ounce, bouncing off a one-week low of $1,270.56 hit in earlier trade. U.S. gold futures for December delivery settled up $4, or 0.3 percent, at $1,282.90 per ounce.

Commodities
1.Crude Oil

Oil prices fell for a third day in a row on Tuesday on forecasts for rising U.S. crude output and a gloomier outlook for global demand growth in a report from the International Energy Agency (IEA). Brent futures fell 95 cents, or 1.5 percent, to settle at $62.21 a barrel, while U.S. West Texas Intermediate (WTI) crude lost $1.06, or 1.9 percent, to end at $55.70, the lowest close for both contracts since Nov. 3.

2.Base Metals

Nickel fell more than 5 percent on Tuesday, leading a broad-based pullback in base metals prices after weaker-than-expected economic data from China sparked concerns about demand. Three-month nickel on the London Metal Exchange closed down 5.7 percent at $11,780 a tonne, its biggest one-day drop since March 2016. LME three-month copper ended the day down 2 percent at $6,759 a tonne. LME zinc finished 1.9 percent lower at $3,151 a tonne. LME lead ended 2.1 percent lower at $2,470.

U.S. Treasuries
1. U.S. Bonds

U.S. Treasury two-year note yields touched a nine-year high on Tuesday, while those on long-dated debt fell as the yield curve flattened for a second straight day and investors braced for the next tightening by the Federal Reserve in December. In late trading, the 10-year Treasury yield was at 2.378 percent, down from 2.4 percent late on Monday. The U.S. two-year yield hit a nine-year peak just shy of 1.7 percent, up from Monday's 1.687 percent. U.S. 30-year bond yields, on the other hand, fell to 2.836 percent, from 2.869 percent on Monday.

2. Chinese bonds

The benchmark CFFEX 10-year contract yields closed at the one-day peak, up 0.27 percent after falling 0.4 percent. In inter-bank market, yields of the most active 10-year Treasury bonds bounced off an intra-day high of 4.01 percent to end at 3.97 percent.

Stock Market
1. U.S. Equities

U.S. stock indexes fell on Tuesday as General Electric shares plunged for a second straight day and a drop in crude oil prices hit energy stocks. The Dow Jones Industrial Average fell 30.23 points, or 0.13 percent, to end at 23,409.47, the S&P 500 lost 5.97 points, or 0.23 percent, to 2,578.87 and the Nasdaq Composite dropped 19.72 points, or 0.29 percent, to 6,737.87.

2. Hong Kong Equities

Hong Kong shares finished down on Tuesday after data showed the mainland economy cooled further last month. Data on Tuesday showed that China's economy lost steam in October, with industrial output, fixed asset investment and retail sales missing expectations as the government extended a crackdown on debt risks and factory pollution. The Hang Seng index fell 0.1 percent, to 29,152.12, while the China Enterprises Index lost 0.7 percent, to 11,601.69 points.

3. China Equities

China’s stocks closed down on Tuesday, snapping a six-day winning streak. Profit-taking on recent gains triggered technical pullback, and decline picked up late in the session, as industrial output, fixed asset investment and retail sales missed expectations. The Shanghai Composite Index closed 18.29 points or 0.53 percent lower to 3,429.55 after hitting a 22-1/2-month high in the previous session. Trading volume of Shanghai A shares rose to 267.1 billion yuan from 266.4 billion yuan.