In Asian Equity Markets Japan’s Nikkei index climbed on Tuesday in choppy trade, with stocks connected to defence buoyed by concerns North Korea may launch a missile, while Toray Industries dived after it said a subsidiary had falsified data. The Nikkei had edged up 0.2 percent to 22,559.00 by mid-morning trade, after earlier trading in negative territory. The broader Topix added 0.2 percent to 1,780.82.  MSCI’s broadest index of Asia-Pacific stocks outside Japan lost 0.3 percent from last week’s high of 570.21 points. The CSI300 index was down 0.3 percent while Shanghai’s SSE Composite index fell 0.2 percent.

 

In Currency Markets the dollar held steady versus the yen on Tuesday and held above a two-month low, with the near-term focus on a possible Senate vote on a U.S. tax plan later in the week. The dollar held steady at 111.14 yen. On Monday, the dollar had set a two-month low of 110.85 yen, as investors were spooked by Japanese media reports saying that North Korea may be preparing for another missile launch. The euro held steady at $1.1903 after scaling a two-month peak at $1.1961 on Monday. The dollar’s index against a basket of currencies held steady at 92.882, having set a two-month low of 92.496 on Monday. The dollar has been hampered recently by uncertainty over the prospects for U.S. tax reform, including tax cuts.

 

In Commodities Markets oil prices fell in Asian trade on Tuesday amid uncertainty over a possible extension of output cuts by major crude producers and expectations of higher supply as the Keystone pipeline restarts.  Brent futures fell to $63.65 a barrel, down 0.3 percent, from their previous close. U.S. West Texas Intermediate futures were down 0.6 percent, at $57.76 a barrel, after falling 1.4 percent in the last session. Gold gained in Asia on Tuesday with sentiment on the rate outlook awaiting further insights from a slew of Fed speakers as well as the US treasury secretary. Gold futures for December delivery redged up 0.09 percent to $1, 295.67 a troy ounce.

 

In US Equity Markets the major indexes ended little changed on Monday, retreating modestly from record highs set during the session, as gains for Amazon countered losses in shares of energy companies. The Dow Jones Industrial Average rose 0.1 percent, to 23,580.78, the S&P 500 lost 0.04 percent, to 2,601.42 and the Nasdaq Composite fell 0.15 percent, to 6,878.52. Shares of online retailer Amazon rose 0.8 percent as consumers sought Cyber Monday online promotions following the Black Friday start to the holiday shopping season. Barracuda Networks shares jumped 16.5 percent after the data security company agreed to be bought by private equity firm Thoma Bravo LLC. Shares of hard-drive maker Western Digital lost 6.7 percent after a downgrade.

 

In Bond Markets longer-dated Japanese government bond prices fell on Tuesday, causing the yield curve to steepen slightly, after an auction of 40-year debt drew lukewarm demand from investors. The five-year yield was flat at minus 0.125 percent, with overnight gains by U.S. Treasuries and sagging Tokyo equities lending support. The 40-year yield, on the other hand, rose 1.5 basis points to 1.020 percent.

 

 

Economic Calendar

• 08:00 GMT+0 UK Bank Stress Test Results
• 08:30 GMT+0 UK BOE Gov Carney Speaks
• 15:45 GMT+0 US Fed Chair Designate Powell Speaks
• 16:00 GMT+0 US CB Consumer Confidence
• 17:30 GMT+0 CAD BOC Gov Poloz Speaks
• 21:00 GMT+0 NZD RBNZ Financial Stability Report
• 21:45 GMT+0 US Treasury Sec Mnuchin Speaks

 

US Equity Upgrades

• ARROWHEAD (ARWR) UPGRADED TO OVERWEIGHT FROM NEUTRAL AT PIPER JAFFRAY
• CIENA (CIEN) UPGRADED TO BUY FROM NEUTRAL AT BOFA/MERRILL
• CONSTELLIUM (CSTM) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT COWEN
• EVEREST RE (RE) UPGRADED TO MARKET PERFORM FROM UNDERPERFORM AT KEEFE BRUYETTE
• GERDAU (GGB) UPGRADED TO BUY FROM NEUTRAL AT BOFA/MERRILL
• LOWE’S (LOW) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT RAYMOND JAMES
• NATIONAL GRID (NGG) UPGRADED TO NEUTRAL FROM UNDERPERFORM AT CREDIT SUISSE
• SABESP (SBS) UPGRADED TO OVERWEIGHT FROM NEUTRAL AT JPMORGAN
• SIERRA WIRELESS (SWIR) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT RAYMOND JAMES
• VALE (VALE) UPGRADED TO OVERWEIGHT FROM EQUAL WEIGHT AT MORGAN STANLEY

 

US Equity Downgrades

• BUFFALO WILD WINGS (BWLD) DOWNGRADED TO NEUTRAL FROM BUY AT UBS
• CUBIC (CUB) DOWNGRADED TO NEUTRAL FROM OVERWEIGHT AT JPMORGAN
• HIMAX (HIMX) DOWNGRADED TO EQUAL WEIGHT FROM OVERWEIGHT AT MORGAN STANLEY
• KIMCO REALTY (KIM) DOWNGRADED TO NEUTRAL FROM OUTPERFORM AT BAIRD
• MAA (MAA) DOWNGRADED TO MARKET PERFORM FROM OUTPERFORM AT BMO CAPITAL
• NORFOLK SOUTHERN (NSC) DOWNGRADED TO SELL FROM HOLD AT LOOP CAPITAL
• SOLAREDGE (SEDG) DOWNGRADED TO HOLD FROM BUY AT DEUTSCHE BANK
• SQUARE (SQ) DOWNGRADED TO SELL FROM NEUTRAL AT BTIG
• TSMC (TSM) DOWNGRADED TO EQUAL WEIGHT FROM OVERWEIGHT AT MORGAN STANLEY
• WESTERN DIGITAL (WDC) DOWNGRADED TO EQUAL WEIGHT FROM OVERWEIGHT AT MORGAN STANLEY

 

US Equity Initiations

• ALLENA PHARMACEUTICALS (ALNA) INITIATED WITH A BUY AT JEFFERIES
• ALLENA PHARMACEUTICALS (ALNA) INITIATED WITH AN OUTPERFORM AT CREDIT SUISSE
• ALLENA PHARMACEUTICALS (ALNA)INITIATED WITH AN OUTPERFORM AT COWEN
• ALLERGAN (AGN) RESUMED WITH AN OUTPERFORM AT LEERINK
• ALTAIR (ALTR) INITIATED WITH A BUY AT DEUTSCHE BANK
• ALTAIR (ALTR) INITIATED WITH A HOLD AT CANACCORD
• ALTAIR (ALTR) INITIATED WITH A SECTOR PERFORM AT RBC CAPITAL
• ALTAIR (ALTR) INITIATED WITH AN OUTPERFORM AT WILLIAM BLAIR
• APPIAN (APPN) INITIATED WITH AN OUTPERFORM AT WILLIAM BLAIR
• APPTIO (APTI) INITIATED WITH AN OUTPERFORM AT JMP SECURITIES
• CAREDX (CDNA) INITIATED WITH A BUY AT H.C. WAINWRIGHT
• EVOQUA WATER (AQUA) INITIATED WITH A BUY AT CITI
• EVOQUA WATER (AQUA) INITIATED WITH AN OUTPERFORM AT RAYMOND JAMES
• EVOQUA WATER (AQUA) INITIATED WITH AN OUTPERFORM AT RBC CAPITAL
• FUNKO (FNKO) INITIATED WITH A BUY AT BOFA/MERRILL
• FUNKO (FNKO) INITIATED WITH A BUY AT JEFFERIES
• FUNKO (FNKO) INITIATED WITH A BUY AT STIFEL
• FUNKO (FNKO) INITIATED WITH A BUY AT SUNTRUST
• FUNKO (FNKO) INITIATED WITH AN OUTPERFORM AT BMO CAPITAL
• FUNKO (FNKO) INITIATED WITH AN OVERWEIGHT AT JPMORGAN
• IRSA PROPIEDADES (IRCP) INITIATED WITH AN OVERWEIGHT AT JPMORGAN
• LOMA NEGRA (LOMA) INITIATED WITH AN EQUAL WEIGHT AT MORGAN STANLEY
• REVANCE (RVNC) INITIATED WITH AN OVERWEIGHT AT BARCLAYS
• SPERO THERAPEUTICS (SPRO) INITIATED WITH A NEUTRAL AT BOFA/MERRILL
• SPERO THERAPEUTICS (SPRO) INITIATED WITH AN OUTPERFORM AT COWEN
• ZOGENIX (ZGNX) INITIATED WITH AN OUTPERFORM AT JMP SECURITIES