Market Brief China wants US tariffs removed before further farm goods purchases

At midday in London, GBP was the strongest and AUD among the weakest. Gold was trading higher, copper and oil lower. Stocks were coming off their best levels after futures rose earlier in the day.
GBP was holding steady following recent sharp gains, undermining the FTSE. The EU's chief negotiator Michel Barnier, who had previously said "big gaps" remained between the UK and EU, has now said a Brexit deal could be struck as early as this week. However, he has warned it was "time to turn good intentions into legal text". The UK and EU officials are set to meet at a summit on Thursday and Friday. This meeting could determine whether UK is headed for a no-deal Brexit at the end of this month.
European stocks were sharply higher earlier but gave up some of those gains after Bloomberg reported, citing people familiar with the matter, that China will struggle to buy $50 billion of US farm goods annually unless Washington removes retaliatory tariffs so they can afford it. The focus will turn to US Q3 earnings reporting session, which kickstarts this week. Lots of bank earnings will come in over the next few days, including Citigroup, JP Morgan, Goldman Sachs and Wells Fargo today and Bank of American tomorrow. HERE is my colleague Ken Odeluga’s bank earnings preview.
Data highlights

The German ZEW Survey revealed the “Current Situation” index deteriorated more than expected (to -25.3 vs. -19.9 in September and -23.6 expected), while the “Expectations” index deteriorated less than expected (-22.8 vs -22.5 last and -26.4 expected).
Supported by raised Brexit optimism, the GBP barely reacted to news UK wages grew less than forecast at 3.8% 3m/y vs. 4.0% eyed or the fact the unemployment rate ticked higher to 3.9% y/y from 3.8% last. Sterling did ease off the highs but was still retaining most of its gains.
Overnight, Chinese CPI inflation came in at +3.0% y/y, above 2.9% expected and 2.8% last. However, PPI measure of inflation declined 1.2% y/y as expected (vs. -0.8% prior). In other news, US President Donald Trump imposed steel tariffs on Turkey Monday night and threatened there could be more to come. This comes after Turkey’s military movement into Syria. The USD/TRY exchange rate was relatively stable at around 5.900

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

City Index is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment further CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.cityindex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.cityindex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 28.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.