I. Yesterday’s News
International News

1. U.S. Senate Republicans rammed forward President Donald Trump's tax cut bill on Tuesday that set up a full vote by the Senate as soon as Thursday, although some details of the measure remained unsettled. The committee voted 12 to 11 today to pass the bill. The White House called the committee action "an important step toward passing historic tax relief and reform."

2. Jerome Powell, President Donald Trump's choice to lead the U.S. Federal Reserve, defended plans to potentially lighten regulation of the financial sector during a controversy-free hearing on his nomination to take over the central bank. In general Powell stuck close to script, reciting the current Fed consensus that interest rates are due to continue rising gradually, that the course of inflation remains a mystery, and that weak wages and low labor force participation indicate the jobs market still has room to improve.

3. U.S consumer confidence surged to a near 17-year high in November, driven by a robust labor market, while house prices rose sharply in September, which should underpin consumer spending and boost economic growth. The near-term growth outlook was, however, marred by other data on Tuesday showing a big rise in the goods trade deficit in October and a drop in inventory accumulation.

4. Global economic growth is set to peak at an eight-year high next year as uninspiring investment and increasingly dangerous debt levels limit room for further improvement, the OECD said on Tuesday. The global economy is on course to grow 3.6 percent this year before reaching 3.7 percent next year then ease back to 3.6 percent in 2019, the Organisation for Economic Cooperation and Development (OECD) said in its latest outlook. The Paris-based policy forum nudged up its estimate for this year from 3.5 percent in its last forecasts dating from September, and left its 2018 projection unchanged.

Domestic News

5. The National Development and Reform Commission (NDRC) will cover all investment projects under central budget into supervision by building an online approval and supervision platform for investment projects and national key construction projects, of which confidential projects will be supervised in accordance with related rules and regulations. Each project will be planned, enforced and monitored online by way of normalized supervision, and dishonesty in project application will be revoked, said NDRC.

6. China will expand a water resource tax pilot program to more areas in a bid to encourage water conservation, the Ministry of Finance (MOF) said Tuesday. Nine provincial regions, including Beijing, Inner Mongolia, Henan, Sichuan and Ningxia will begin the new tax pilot starting from December 1. The water resource tax is collected based on the water usage to ease burden on normal water usage.

7. The official manufacturing Purchasing Managers' Index (PMI) on Thursday is expected to come in at 51.4 for November, according to a median forecast of 28 economists polled by Reuters, due to cold winter weather, government crackdown on manufacturing pollution, suggesting overall soft economy in the fourth quarter.

II. Market Overview
FX
1. Global Market

The dollar rose against a basket of currencies on Tuesday, rebounding from a two-month low hit the previous day, helped by strong U.S. data and as Federal Reserve chair nominee Jerome Powell signalled that the central bank is likely to raise interest rates again next month. The dollar index, which measures the greenback against six rival currencies, was up 0.36 percent at 93.24. Against the yen the dollar was 0.3 percent higher, shrugging off momentary weakness, after North Korea launched a missile that landed close to Japan on Wednesday.

2. Home Market

China's yuan fell against the U.S. dollar in the morning session of Tuesday, drawing near to the key support of $6.61 during one point, as the official midpoint rates dropped. Yuan extended wide rangebound as the dollar index steadied overnight and bargain-hunting emerged. The Chinese currency is expected to test the resistance of $6.55 in case the dollar remained subdued.

Precious Metals

Gold edged higher, in tandem with the dollar, after U.S. Federal Reserve chair nominee Jerome Powell’s confirmation hearing at the Senate Banking Committee, but was still lower than the six-week high hit on Monday. Spot gold ended at $1,293.61 an ounce after closing at 1,294.44 the previous day. It hit 1,299.13, the highest since mid-October, during one point. U.S. gold futures for December delivery settled up 0.04 percent, at $1,294.90 per ounce.

Commodities
1.Crude Oil

Oil prices eased on Tuesday, weighed down by uncertainty over the outcome of an OPEC meeting this week at which an extension to its price-supporting oil output cuts will be discussed. Brent crude oil ended the session down 23 cents, or 0.4 percent, at $63.61 a barrel. U.S. crude settled 12 cents, or 0.2 percent lower at $57.99.

2.Base Metals

Nickel prices hit their lowest level in more than six weeks on Tuesday as the market fretted about weaker demand in top consumer China and rising supplies from major producer Indonesia. Benchmark nickel on the London Metal Exchange ended down 1.9 percent at $11,350 a tonne. In earlier trading the metal used mostly in stainless steel fell to $11,255, its lowest since Oct. 12. Copper slipped two percent to $6,805.

U.S. Treasuries
1. U.S. Bonds

U.S. Treasury yields inched higher on Tuesday, as risk appetite improved with Wall Street shares hitting record highs after upbeat consumer confidence data and a Senate panel vote to advance a U.S. tax bill. In late trading, the 10-year Treasury yield was up at 2.336 percent, from 2.328 percent late on Monday. U.S. two-year yields, which climbed to a nine-year peak last week, were at 1.754 percent from 1.745 percent on Monday. U.S. 30-year bond yields were up slightly at 2.766 percent from Monday's 2.765 percent.

2. Chinese bonds

Liquidity in China’s inter-bank market showed mixed structural demand with ample overnight funds and short 7-day funds. Investors shall closely watch the hedge operations by the central bank as large amount of reverse repo is about to expire in the following two days.

Stock Market
1. U.S. Equities

Wall Street surged to record highs on Tuesday led by sharp gains in bank stocks, and boosted by progress for a tax cut bill, strong consumer confidence data and encouraging comments from President Donald Trump's nominee to lead the Federal Reserve. The S&P financial sector soared 2.6 percent, its biggest daily percentage increase since March 1. The Dow Jones Industrial Average rose 255.93 points, or 1.09 percent, to 23,836.71, the S&P 500 gained 25.63 points, or 0.99 percent, to 2,627.05 and the Nasdaq Composite added 33.84 points, or 0.49 percent, to 6,912.36. All three indexes notched record closing highs.

2. Hong Kong Equities

Hong Kong's benchmark share index ended little changed on Tuesday after trimming early losses. The Hang Seng index was unchanged at 29,680.85 points, while the China Enterprises Index lost 0.6 percent to 11,705.58.

3. China Equities

The benchmark Shanghai Composite Index settled up 11.43 points or 0.34 percent to 3,333.66, with its turnover shrinking by almost 20 percent. The CSI300 closed at 4,055.82, up 0.14 percent. CSI 300 benchmark futures for December delivery rose 0.18 percent to 4,041.2.