• Asian equity markets began the week on the front boot amid virus treatment hopes after reports the FDA granted EUA for Regeneron’s REGN-COV2 antibody cocktail
• However, some of the optimism in the region was offset by concerns regarding rising infection
• In FX markets, the DXY trades softer, EUR/USD eyes 1.19 to the upside, GBP outperforms on Brexit optimism
• UK PM Johnson is preparing a significant Brexit intervention as negotiators start their final push for a deal
• UK PM Johnson is to tell MPs on Monday that he will end the lockdown in England on December 2nd and replace it with toughened-up tiers
• US GOP sources said the White House will push for a new COVID-19 stimulus in December to help the GOP in the Georgia Senate run offs
• Looking ahead, highlights include EZ, UK & US PMIs (flash), BoE's Haldane, Bailey, Fed's Evans, Daly, ECB's Schnabel, US 2yr and 5yr supply

CORONAVIRUS UPDATE

US CDC reported total COVID-19 cases rose to 12.0mln from 11.8mln the day before and total deaths rose to 255.1k from 253.6k the day before, while a major newswire tally stated US cases rose by at least 168,288 to a total of 12.27mln and deaths rose by at least 1,230 to a total of 257.1k. (Newswires)

Los Angeles County announced to ban all in-person dining effective Wednesday at 10:00pm due to a surge in cases but will not go in to full lockdown as cases remain beneath the threshold. (Newswires)

Regeneron announced that its antibody cocktail REGN-COV2 received Emergency Use Authorization from the US FDA. FDA stated that it authorized monoclonal antibodies for treatment of COVID-19 in which casirivimab and imdevimab are to be administered together by IV infusion and were shown to reduce COVID-19-related hospitalization, but noted benefit of casirivimab and imdevimab treatment has not been shown in patients that were hospitalized for COVID-19. (Newswires)

Pfizer’s vaccine could receive UK approval in the week ahead with British regulators to begin the formal review of the jabs by Pfizer and BioNTech, while NHS was reportedly told to be ready to administer them by December 1st. (Telegraph) Seperately for Pfizer, Operation Warp Speed's Slaoui has suggested that the FDA could act on the Co.'s COVID vaccine as early as December 10th. (Twitter)

Roche CEO expects the tens of millions of COVID-19 tests the Co. is producing won’t be enough this winter amid the surge of infections across the northern hemisphere. (Newswires)

UK COVID-19 cases +18,662 (prev. + 19,875) and deaths +398 (prev. +341), France cases +13,157 (prev. +17,881) and deaths +215 (prev. +276), while Italy cases +28,337 (prev. +34,767) and deaths +562 (prev. +692). (Newswires)

UK PM Johnson is to tell MPs on Monday that he will end the lockdown in England on December 2nd and replace it with toughened-up tiers, while the new plan will see more areas enter the stricter tiers although reports added the plan for a new stricter tiered system is under threat after 70 Conservative MPs threatened to veto it in Parliament. There were also reports that PM Johnson is expected to set out ‘major’ testing plans which will form part of stronger tiered local restrictions to replace England’s lockdown. (Newswires/Telegraph/Huffington Post)

UK Chancellor Sunak said the government is looking at the 10pm curfew for hospitality and stated that now is the correct time to borrow to fight the crisis, while the Treasury noted that Chancellor Sunak is expected to announce a package valued over GBP 3bln to support the NHS amid the pandemic. (Newswires)

UK will lift blanket quarantine restrictions on December 15th so families can travel to red list countries for Christmas, while the length of time people will need to self-isolate will be cut to 5 days from 14 days if a UK holidaymaker tests negative 5 days after returning. (Telegraph)

UK quarantine for contacts of Covid-19 cases could be halved or eliminated in a pilot scheme which could prevent hundreds of thousands of people from unnecessary isolation. According to reports, emergency service workers will be provided daily tests with new pregnancy-style test kits in the next phase of mass testing set to be launched in Liverpool in the week ahead, while all those that have been instructed to isolate due to contact with an infected person could be offered a test after seven days of quarantine to allow them to leave home faster. (Times)

French President Macron will on Tuesday announce government plans to relax lockdown measures in 3 steps as infections recede with the first easing to take place “around” December 1st, second step before the end-of-the-year holidays and the third will be from January. However, confinement measures and travel limitations will remain in place for some time, while restaurants and bars will still face restrictions, according to government spokesman Gabriel Attal. (Le Journal du Dimanche)

Spanish PM Sanchez said that they will begin a comprehensive vaccine programme in January in which Spain, alongside Germany, will be the first in the EU to have a complete vaccination plan. (Newswires)

Germany’s senior politicians stated that they will have to extend current measures to contain the pandemic into December, while other reports noted that Germany was considering a partial lockdown until December 20th. (Newswires)

South Korea is imposing stricter social-distancing measures including limiting restaurant hours and social gatherings, as a surge in cases threatens to undermine earlier efforts to contain the pandemic, while the alert level for the Greater Seoul area was increased to 2 from 1.5 effective Nov. 24. This will ban gatherings in high-risk venues such as night clubs and karaoke bars, while restaurants are prohibited from serving after 2100 and can only operate takeouts and deliveries. (Newswires)

Hong Kong Health Secretary Sophia Chan stated that Hong Kong will make a payment of HKD 5,000 to anyone in the city that tests positive for COVID-19 in an effort to get people tested. (Newswires)

G20 communique stated they will spare no effort to ensure affordable and equitable access to COVID-19 vaccines, drugs and tests, while they will protect lives and provide support with focus on the most vulnerable. The G20 is will also focus to restore economic growth, as well as protect and create jobs. (Newswires)

ASIA

Asian equity markets began the week on the front boot amid virus treatment hopes after reports the FDA granted EUA for Regeneron’s REGN-COV2 antibody cocktail but with some of the optimism in the region offset by concerns regarding rising infections. ASX 200 (+0.3%) traded higher following upgrades in domestic PMI data and as the energy sector spearheaded the commodity-led push after Ampol surged on reports it will receive a higher amount for the stake in its convenience property portfolio and will conduct a AUD 300mln share buyback. However, the gains in the index were restricted as financials lagged with IAG shares resuming their underperformance for a 3rd consecutive session. KOSPI (+1.8%) outperformed after a surge in exports for the first 20 days in November helped participants overlook the rising COVID-19 infection rates which prompted an increase in the Greater Seoul area social distancing level to 2 from 1.5 effective from Tuesday. Hang Seng (Unch.) and Shanghai Comp. (+1.4%) were mixed with the mainland kept afloat following a PBoC liquidity injection and with Hong Kong subdued by weakness in casino and property names. Furthermore, the HK-Singapore travel bubble was delayed for 2 weeks which pressured shares in their respective flag carriers, while recent reports also noted the US is very close to declaring that 89 Chinese aerospace and other companies have links to the Chinese military which could stop them from receiving certain US exports. As a reminder, Japanese markets were closed due to Labor Thanksgiving Day.

PBoC injected CNY 40bln via 7-day reverse repos at a rate of 2.20% for a net daily injection of CNY 40bln. (Newswires) PBoC set USD/CNY mid-point at 6.5719 vs. Exp. 6.5717 (Prev. 6.5786)

US Commerce Department document stated that the US is very close to declaring that 89 Chinese aerospace and other companies have links to the Chinese military which could stop them from receiving certain US exports. This follows recent source reports the US was set to designate four more Chinese companies as backed by the Chinese military which would restrict their access to US investors as the Trump administration seeks to cement its hawkish China legacy in its waning days. (Newswires)

US and Taiwan signed an agreement to set up annual economic talks for 5 years despite opposition from China regarding US support for Taiwan. There were also reports that a US Navy Rear Admiral was on an unannounced visit to Taiwan, according to sources. (Newswires)

Chinese President Xi proposed using a global QR code system to facilitate cross-border movement of people amid the coronavirus pandemic, while he told the G20 summit that there needs to be standardised arrangements and opening up fast tracks to help restart movement again. (Newswires)

China Vice Premier Liu He chaired a meeting of the Financial Stability and Development Committee in which they stated that China will demonstrate zero tolerance regarding misconduct following recent bond defaults. (Newswires)

UK/EU

BoE's Haskel said the shift towards home working was unlikely to last as most companies had not found it to be productive, while he added remote working is leading to longer hours and could result in jobs being moved abroad. (The Times)

UK Chancellor Sunak is to layout plans for a new national infrastructure bank in the week ahead to provide billions in funding for capital projects. There were also separate comments from Chancellor Sunak that you will not see austerity next and that there will be more money for public services in the spending review with the primary focus of the review to be on fighting the coronavirus. (Newswires/FT)

UK regulators signalled to banks that they will consider easing their stance regarding dividends payouts on a case-by-case basis by early next year, with the Bank of England’s Prudential Regulation Authority likely to consider the wider economic backdrop and will take a final view only after lenders close their fourth-quarter books, according to sources familiar with discussions. (FT)

UK PM Johnson is preparing a significant Brexit intervention as negotiators start their final push for a deal, while PM Johnson is expected to speak with European Commission President Von Der Leyen in an attempt to clear the final hurdles for a deal. (Newswires) UK government source stated that there was increasing expectation for a post-Brexit trade agreement, while reports added that civil servants have started to draw up legislation for a Brexit deal that would need to pass through parliament at breakneck speed. (Times)

EU officials are said to think a post-Brexit agreement is 95% agreed although there is still anxiety regarding the impact if discussion fail, according to reports citing confidential notes. (Sky) There were separate reports citing comments from an EU diplomat that gaps are only slowly shirking in the core areas and there is growing concern there is not enough time left. (Newswires/BBC//Twitter)

UK and Canada agreed to a post-Brexit trade deal in which the current EU-Canada Comprehensive and Economic Trade Agreement (CETA) will be extended with UK for a short-term transitional agreement. (Newswires)

China Chamber of Commerce in the UK which represents companies including Huawei, ZTE and Air China warned Britain will lose billions of pounds of investment and thousands of jobs unless it reverses its hostility to China, while it added there could be a consumer backlash against British companies such as Jaguar Land Rover and Burberry, which are heavily reliant on China’s middle-class customers. (Times)

ECB’s Lane stated that current lockdowns will result to a drop in activity although the impact would be less severe than in the Spring, while he reiterated that EU emergency bond purchases will continue. (Les Echos)

Fitch affirmed Portugal at BBB; Outlook Stable, while S&P cut South Africa to BB-; Outlook Stable. (Newswires)

FX

In FX markets, the DXY softened as the positive risk tone sapped haven appeal and with the greenback also not helped by the rising infection numbers stateside in which the total number of cases have surpassed the 12mln milestone. EUR/USD benefitted from the softer greenback with the single currency marginally higher after its recent bounce off a floor at 1.1850 and GBP/USD outperformed among the G10 currencies to reclaim the 1.3300 status amid optimism for a Brexit deal. This follows reports UK PM Johnson is preparing significant Brexit intervention and is expected to speak with European Commission President Von Der Leyen in an attempt to clear the final hurdles for a deal, while EU officials were also said to surmise that a post-Brexit agreement is 95% agreed although there was still anxiety regarding the fallout if discussions fail. On the COVID front, UK PM Johnson is to tell MPs today that he will end the lockdown in England on December 2nd and replace it with a tougher three-tiered system which will see more areas enter the stricter tiers although there was also opposition to the plan after 70 Conservative MPs threatened to veto it in Parliament. Elsewhere, USD/JPY was flat amid the absence of Japanese participants and antipodeans were marginally higher amid the USD weakness and constructive risk tone, as well as an improvement in Australian PMIs and New Zealand Retail Sales data.

Turkey President Erdogan stated that country views itself as part of Europe and called on the EU to keeps it promises to Turkey including full membership in the EU. (Newswires)

Fitch downgraded South Africa by one notch to BB-; Outlook Negative. (Newswires)

COMMODITIES

Commodities traded rangebound with WTI crude futures kept afloat around the USD 42.50/bbl level amid the mostly positive risk tone amid the COVID-19 treatment hopes, but with upside limited by a lack of pertinent weekend newsflow and surging COVID-19 cases stateside which have surpassed the 12mln milestone, while it was also reported that Abu Dhabi boosted its oil reseves with a 22bln barrels discovery. Gold prices were little changed with support from a weaker greenback counterbalanced by the lack of haven demand and copper flatlined after recent advances were stalled by resistance at USD 3.30/lb.

Baker Hughes US Rig Count (Nov 20th) Oil -5 at 231, NatGas +3 at 76, Total -2 at 310. (Newswires)

Abu Dhabi's Supreme Petroleum Council announced new discoveries of 22bln bbls of recoverable unconventional oil resources, while it approved capex of USD 122bln for 2021-2025, according to an ArgusMedia correspondent. (Twitter)

India PM Modi said that the country is set to double oil refining capacity in 5 years which would be earlier than expected. (Newswires)

GEOPOLITICAL

Yemen's Houthis' military spokesman said it fired a rocket at an Aramco distribution station and advised foreign companies working in Saudi Arabia to exercise caution as Houthi operations will continue(Newswires)

US

The Treasury curve bull-flattened on Friday amid risk aversion on the Fed’s facilities, more QE tweak commentary, and month-end flows. By settlement, 2s -0.8bps at 16.1bps, 10s -2.7bps at 82.8bps, 30s -4.6bps at 153.2bps; inflation breakevens narrowed; T-Note futures volumes were decent. Treasuries caught a bid on Thursday evening after Treasury Secretary Mnuchin requested the return of unused funding from several of the Fed’s emergency lending facilities. The bid was in part haven-related amid the wider market uncertainty on the announcement. But there were also supply considerations at play, with the outlook for ramped up Treasury issuance on the back of new stimulus programmes reduced amid the (pending) transfer of USD 455bln into the Treasury General Account. There were additional tailwinds for USTs on the back of more Fed speak, where Evans (2021 voter) said the Fed is looking "at the scale" of its asset purchases, and that extending the maturities of its purchases was within the tool kit and the Fed could also raise the size of its balance sheet more quickly if needed. Evans was just the latest FOMC member to allude to QE tweaks/enhancements, a narrative that has been catching traction in recent weeks and also a thorn in the side of the many holding consensus steepener trades that had brought yields to new cycle highs just last week on the back of vaccine news. The 10- and 30-year cash yields have gradually trundled lower by around 15bps and 25bps, respectively, since those highs (98bps and 178bps) on November 9th, but sit above the early November lows of 72bps and 148bps seen in the wake of the election as the Dem Sweep narrative became broken. Heading into month-end, there is strong index rebalancing, with 0.16yr’s worth of duration expected to be added for USTs. Furthermore, futures contract are expected to continue rolling into the March contract in the coming sessions. T-Notes are already more than 16% complete, with the roll expected to occur faster than usual amid Thanksgiving at the end of next week. T-note (Z0) futures settled 4+ ticks higher at 138-16.

Fed Chair Powell stated that the Fed will comply with the Treasury request to return unused CARES Act funds in connection with the year-end termination. (Newswires)

US Treasury official said the decision to pull back funding from the Fed facilities will not hamstring the next Treasury Secretary who will have up to USD 600bln in cash for direct aid and USD 750bln-800bln for Fed lending facilities, while the official added financial markets do not seem unhappy and are reacting positively to prospects of a vaccine. (Newswires)

US Senate Majority Leader McConnell said on Friday that Congress should repurpose the expiring Fed facility funds which should be used towards targeted COVID relief and that a new package should include a second round of small business aid through PPP. (Newswires)

US GOP sources said the White House will push for a new COVID-19 stimulus in December to help the GOP in the Georgia Senate run offs and wants USD 150bln tranche of PPP in which funding could occur by December, according to FBN's Gasparino. (Twitter)

US President-elect Biden agreed with House Speaker Pelosi and Senate Minority Leader Schumer that they need to pass a bipartisan COVID relief package during the current session, according to a spokesperson. (Newswires)

ELECTION UPDATE

US President-elect Biden plans to name longtime adviser Antony Blinken as Secretary of State, while former Hilary Clinton aide Jake Sullivan is likely to be named National Security Adviser, while President-elect Biden’s incoming Chief of Staff Klain said Biden will announce his first picks for the Cabinet on Tuesday. (Newswires)

US President Trump tweeted that "In certain swing states, there were more votes than people who voted, and in big numbers.... Stopping Poll Watchers, voting for unsuspecting people, fake ballots and so much more. Such egregious conduct. We will win!". (Twitter)

US President Trump’s campaign appealed the ruling that was issued by judge over the weekend which denied request to halt Biden’s win in Pennsylvania. (Newswires)