Catch up on Monday’s top 5 market news By

By Geoffrey Smith and Jessica Bahia Melo – Chinese assets soar as the country’s reopening momentum builds. The price also rises, after OPEC+ leaves production quotas unchanged with the entry into force of Europe’s embargo on Russian oil and products.

Stocks are set to open lower, with Apple supplier Foxconn (TW:) reporting a 29% drop in monthly revenue in November. The ISM non-manufacturing survey will add a few more details to a labor market report that smacked of stubborn inflationary pressures, and cryptocurrencies extend their recovery despite ongoing concerns over Genesis exchange.

Adjustments before the Transition PEC go to plenary in the Brazilian Senate.

Here’s what you need to know in financial markets on Monday, December 5th.

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1. Reopening of China

Chinese assets surged again, lifting industrial commodity prices as more cities announced a relaxation of their public health measures, reinforcing belief that the country is serious about reopening its economy.

The offshore rose to the 7 level against the , reaching its highest level in two and a half months. Stock market indices, most notably the , rose again, while crude oil and oil prices rose sharply, the latter also contributing to further gains in mining stocks.

Over the weekend, Shanghai and neighboring Hangzhou relaxed their restrictions, while experts at the Chinese Center for Disease Control said the country should move to rapid antigen testing and allow home isolation for people with mild infections.

CHECK OUT: Economic Calendar

2. Oil in Chinese news; Russian oil embargo comes into effect

The Organization of Petroleum Exporting Countries and allies led by Russia have extended their existing production quotas for another month, against a backdrop of high uncertainty caused by the flow of contrasting news from various parts of the world.

The prospect of an unwinding of pent-up demand in China gained the upper hand in overnight trading in Asia and Europe, pushing U.S. crude futures up 2.63% to $82.10 a barrel and futures up to 2.64. %, to US$87.83 a barrel at 9:48 am (Brasília time).

However, the risk of a looming recession in the US and Europe remains a drag on demand, while the effects of a European Union (EU) embargo on Russian oil imports, which takes effect on Monday, remain uncertain. The EU, together with G7 partners, also imposed a ban on providing essential transport and insurance services to shippers of Russian oil, unless the price of the cargo is less than $60 a barrel. Russia has repeated that it will not sell to any buyer who meets the G7 ‘threshold’.

CHECK: Quotation of the main commodities

3. The Transition PEC has a date for voting in the Brazilian Senate and must be dehydrated

With the deadline for voting approaching before the approval of the 2023 Budget, the Proposed Amendment to the Constitution (PEC) of the Transition has a decisive week of negotiation and processing. The Constitution and Justice Committee (CCJ) of the Senate should deal with the matter tomorrow and, on Wednesday, the proposal enters the plenary agenda. As it is a PEC, the matter needs the approval of 49 of the 81 senators in two shifts. In the Chamber of Deputies, it requires a positive assessment of 308 of the 513 deputies, also in two rounds.

President-elect Luiz Inácio Lula da Silva (PT) is in Brasília and should personally follow the PEC negotiations this week. The measure seeks to remove the payment of the Auxílio Brasil, which should be renamed Bolsa Família, from the spending ceiling, in addition to other campaign promises, such as the readjustment of the minimum wage above inflation.

The leader of the MDB in the Senate, Eduardo Braga (AM), wants to reduce the validity of the PEC to two years and filed an amendment for the change, but there is still negotiation with the parties.

“For the time being, it seems that there is a consensus for a waiver of R$150bn to be given and the renegotiation would only take place in 2 years for a new waiver”, believes Ativa Investimentos.

CHECK: Quotation of Brazilian shares

4. Non-manufacturing ISM, US durable goods orders; drop in retail sales in the euro zone

The Institute for Supply Management’s non-manufacturing (ISM) will shed more light on the health of the key services sector, after one on Friday showed labor shortages, keeping inflationary pressures very much intact.

Analysts expect the ISM Purchasing Managers’ Index to have dropped from 54.4 to 53.3, a level that would still suggest a solid rate of expansion. Of particular interest will be the subindices for and , the latter of which is still close to a record high.

In addition, there will also be data for and for October and the Conference Board Index for . Eurozone overnight data was predictably dismal, with drops of 1.8% in October and November clearly confirming the single currency area is in contractionary territory.

CHECK: Quotation of the main global indices

US stock markets are forecast to open lower after a stronger-than-expected labor market report for November, which provided a grim reality check for those who believe in a quick end to the US rate hike. of

By 9:49 am, it was down 167 points, or 0.48%, while it was down 0.55%, and was down 0.48%.

Stocks likely to be in focus later include Apple (NASDAQ:), after the contract maker Hon Hai Precision (TW:) – or Foxconn – said its revenue was down 29% in November from October due to the extreme disruption of its operations in the so-called iPhone City in Zhengzhou, where workers rioted against the closure conditions. The sometimes violent protests appear to have been a key factor in causing Beijing to back away from strict enforcement of its Covid-zero policy.

Apple, which was reported by The Wall Street Journal to be eyeing plans to move production out of China over the weekend, was flat in premarket trading.

CHECK OUT: Real-time premarket US stock quotes

5. Cryptocurrency Recovery Stretches Despite Genesis Concerns

Cryptocurrency prices were resilient in weekend trading despite new revelations and commentary that continued to paint the asset class in an unflattering light.

The Financial Times reported that digital asset trading group Genesis and its parent company, Barry Silbert’s Digital Currency Group, owe clients of the Winklevoss Twins exchange $900 million. Withdrawals from Genesis and the Gemini’s Earn program, its main lending project, have been suspended for three weeks and there are few signs the suspension will be lifted anytime soon.

Furthermore, Sam Bankman-Fried, whose FTX exchange crash caused the latest cryptocurrency market turmoil, continued to speak out in interviews with the FT and the WSJ about allegations of ignorance about the true state of affairs at FTX and its affiliate of the hedge fund Alameda Research.

However, for the first time in over three weeks, the market has strengthened above $17,000, while altcoins have also extended their recovery.

CHECK: Cryptocurrency quotes

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