EUROPEAN OPEN: Trump admin urges SCOTUS to hear BAYN GY's appeal to limit Roundup lawsuits; OR FP to work on Armani deal; NESN SW mulls sale of Blue Bottle Coffee unit; BoE lowers banks' CET1 requirement; ENT LN upgraded

• 
  EUROPEAN OPEN: European equity futures opened around neutral after an APAC session in which stocks mostly rose despite a weak Wall Street lead and few catalysts. Silver gained but slipped from its recent record as technical indicators showed its six-day rally had moved into overbought territory, while gold edged lower. Traders have been betting on prolonged supply tightness and the prospect of another Fed rate cut. Copper retreated from a record high on signs of softer Chinese winter demand, ending a two-day rise. Crude held gains as markets watched US President Trump’s next steps on Venezuela and assessed damage at a Black Sea crude export terminal; Brent traded near USD 63/bbl and WTI stayed above USD 59/bbl. Recently, Turkey said an oil tanker sailing from Russia to Georgia was attacked in the Black Sea. On the Fed chair race, WSJ Fedwatcher Timiraos reported that President Trump appears to have effectively settled on adviser Kevin Hassett, who stands out for loyalty and market credibility, making him the leading contender for the nomination. In the UK, PM Starmer urged businesses to deepen trade with China while acknowledging security risks, ahead of a 10th December decision on China’s proposed London embassy, the FT reported; he said sectors such as financial services, creative industries, pharmaceuticals and luxury goods offer export potential. In data, Nationwide said UK house prices rose 0.3% M/M in November (exp. 0.1%), while annual growth eased to 1.8% Y/Y from 2.4%; it reported stable prices and mortgage approvals near pre-pandemic levels despite weak confidence, a softer labour market and higher mortgage rates, adding that April 2028 property tax changes will affect under 1% of English homes and about 3% in London.


• 
  STOCK SPECIFICS: In healthcare, the Trump administration urged the US Supreme Court to hear Bayer’s (BAYN GY) appeal to limit more than 67,000 Roundup lawsuits, backing its argument that federal pesticide law pre-empts state claims. In consumer sectors, L’Oreal (OR FP) CFO said the company will begin work on a potential Armani deal “very soon”. Nestle (NESN SW) is considering selling its Blue Bottle Coffee unit, acquired in 2017 for USD 700mln, Reuters reported, noting any sale may come at a discount. Of note for Reckitt (RKT LN), China will impose a 13% VAT on contraceptive drugs and devices, ending exemptions in place since 1993 under the one-child policy as it seeks to counter falling birth rates that threaten to slow the economy further. In materials, Europe’s rearmament drive has increased demand for rare earth minerals used in high-tech weapons, but US firms are securing supplies more quickly, Bloomberg said. Separately, Reuters reported that China has issued its first rare earth magnet general export licence since the Trump-Xi meeting, with at least three Chinese firms receiving approvals. The EU plans to commit at least EUR 3bln in 2026 to cut reliance on China for critical raw materials, according to a draft proposal. In financials, and of note for UK banks, the BoE’s Financial Policy Committee cut its system-wide Tier 1 capital requirement by 1ppt to about 13% of risk-weighted assets and kept the CCyB at 2%. The FPC flagged further work on buffer usability and the UK leverage ratio, and backed a private-markets system-wide exploratory scenario. Santander (SAN SM) launched an ABB to sell 3.57mln shares in Santander Bank Polska, about 3.5% of its share capital and voting rights, as part of its planned share sale. In notable broker moves, Entain (ENT LN) was upgraded at JPMorgan; Taylor Wimpey (TW/ LN) was upgraded at RBC; and Michelin (ML FP) was downgraded at Morgan Stanley.

TODAY'S AGENDA:

• DAY AHEAD: In Europe, flash November inflation is expected to show headline Y/Y unchanged at 2.1%, while core and supercore are seen ticking up 0.1 percentage point each to 2.4% Y/Y. The EU jobless rate is forecast to hold at 6.3%. The US session features the December RCM/TIPP economic optimism index. On the speakers’ slate, Fed policymaker Bowman appears at a hearing on oversight of financial regulators, with no monetary policy comments expected. ECB Buch (supervisory) will also speak. Supply includes a GBP 1bln 2031 linker from the UK and Germany’s sale of EUR 4.5bln of 2027 Schatz. After the US close, the API will issue weekly energy inventory data; crude stocks are expected to fall by 1.8mln bbls, with distillates and gasoline seen rising by 1.3mln bbls and 2.0mln bbls respectively. Notable US corporates reporting include MRVL, CRWD and SIG.

02 Dec 2025 - 08:11- Fixed IncomeGeopolitical- Source: Newsquawk