I. Yesterday's News
International News
1. The European Central Bank took a step towards weaning the euro zone off loose money on Thursday but promised years of stimulus and even left the door open to backtracking. It said it would cut its bond purchases in half from January but also extend the buying programme until the end of next September. ECB President Mario Draghi said the euro zone economy was recovering but still needed support. After the announcement, the euro had its worst day against the dollar in 16 months. European stocks rose, while euro zone Treasury yields fell.

2. President Donald Trump's search for the next chair of the U.S. Federal Reserve has come down to Fed Governor Jerome Powell and Stanford University economist John Taylor, Politico on Thursday cited one source as saying, while another counseled caution. Trump has said he was considering both Powell and Taylor, but that he also liked current Fed Chair Janet Yellen very much. Politico cited an unnamed source who talks regularly to Trump as saying the only finalists were Powell and Taylor.

3. Catalonia's leader Carles Puigdemont on Thursday said he would not hold a new regional election to break the deadlock between Madrid and separatists wanting to split from Spain, sharpening a political crisis that could turn into direct confrontation. Puigdemont had been expected to announce an election to head off moves by Madrid to take direct control of the autonomous region in the next few days. But, speaking in the courtyard of the regional government headquarters in Barcelona, Puigdemont said the central government had not provided sufficient guarantees that holding an election would prevent the imposition of direct rule.

4. The number of Americans filing for unemployment benefits increased less than expected last week, suggesting the labor market continued to tighten after recent hurricane-related disruptions. Other reports on Thursday, however, offered a less favorable look at the economy. The goods trade deficit widened in September and retail inventories fell, prompting the Atlanta Federal Reserve to trim its third-quarter GDP growth estimate. In addition, signed contracts to buy previously-owned homes were unchanged last month. The Commerce Department said the goods trade deficit rose 1.3 percent to $64.1 billion in September, while wholesale inventories increased 0.3 percent last month. But stocks of goods at retailers tumbled 1.0 percent. U.S. financial markets were little moved by the data as investors digested the European Central Bank's announcement that it would extend its bond purchases at a reduced rate. The dollar rose against a basket of currencies, while prices for U.S. Treasuries were largely unchanged. Stocks on Wall Street rose.

Domestic News
5. China began to experiment with the notion of Green gross domestic product (GDP) as signaled in the report of the 19th National Congress that China would deepen economic reforms as it transitions from high-speed to high-quality growth, instead of setting a target to double its GDP. It will be a key feature in the new norm of China's economy. “We will not solely pursue economic growth, but will achieve growth by enhancing quality, efficiency and changing growth drivers,” said Yang Weimin, deputy head of the Office of the Central Leading Group on Financial and Economic Affairs.

6. U.S. President Donald Trump will seek "tangible" agreements on trade with China when he visits the country next month, but results on key issues such as market access may take longer, U.S. Commerce Secretary Wilbur Ross said on Wednesday.

7. China saw strong appetite yesterday for its first sale of sovereign dollar bonds for years. China's Ministry of Finance has already attracted over $10 billion in orders, including interest from joint bookrunners, for its proposed $2 billion sovereign U.S. dollar bonds offering launched this morning.

II. Market Overview
FX
1. Global Market
The euro tumbled on Thursday for its worst day against the dollar in 16 months as the European Central Bank prolonged its bond purchases well into 2018, diminishing the chances the ECB would raise interest rates next year. The euro sagged to $1.1651, down nearly 1.4 percent from late Wednesday for its steepest one-day loss against the greenback since June 2016, Reuters data showed. The euro was still nearly 11 percent stronger versus the greenback since the end of 2016. The single currency was down 1.2 percent at 132.79 yen. It retreated from 134.48 yen reached earlier on Thursday which was its strongest against the Japanese currency since December 2015. An index that tracks the dollar against euro, yen and four other currencies hit a three-month high at 94.668 after breaking key technical resistance. It gained 1 percent for its biggest one-day gain since Dec. 15.

2. Home Market
China's yuan edged up against the dollar in the morning session on Thursday. Forex settlement and selling by investors balanced at month-end, and yuan, basically tracking the dollar, is expected to extend wide swing due to lack of direction in the dollar index in near term, traders said.

Precious Metals
Gold fell to a nearly three-week low on Thursday as the dollar gained against the euro after the European Central Bank said it would extend the lifespan of its bond-buying program. European stock markets gained following the decision as investors started to price out future rate increases, moving away from safe-haven gold and bonds and into stocks and other assets perceived as risky. Spot gold was down at $1,266.73 an ounce. U.S. gold futures for December delivery settled down $9.40, or 0.7 percent, at $1,269.60 per ounce.

Commodities
1.Crude Oil
Brent crude closed at a 27-month high on Thursday as the market focused more on comments from Saudi Arabia about ending a global supply glut instead of an unexpected increase in U.S. crude inventories and high U.S. production and exports. Brent futures gained 86 cents, or 1.5 percent, to settle at $59.30 a barrel, its highest close since July 3, 2015. U.S. West Texas Intermediate crude, meanwhile, rose 46 cents, or 0.9 percent, to settle at a six-month high of $52.64, its highest close since April 17.

2.Base Metals
Aluminium prices reached their highest in more than five years on Thursday, as expected capacity cuts during the winter drew closer and concerns grew of a supply shortfall as inventories in London fell to a nine-year low. London Metal Exchange aluminium ended up 0.2 percent at $2,190 per tonne, having peaked at $2,215 during the session, its highest since March 2012. Copper closed 0.3 percent lower at $6,986 per tonne.

U.S. Treasuries
1. U.S. Bonds
U.S. Treasury yields inched higher on Thursday in choppy trading, undermined by a soft auction of U.S. 7-year notes which saw demand at its weakest since August last year. In late trading, 10-year U.S. Treasury note yields were at 2.453 percent, up from Wednesday's 2.444 percent. U.S. 30-year bond yields were up at 2.959 percent, from 2.955 percent the previous session. Following the auction, U.S. 7-year note yields were at 2.296 percent, up from Wednesday's 2.282 percent.

2. Chinese bonds
China's bonds softened in the morning session despite the central bank cleared the rumor that “the ceiling of interbank debts will be revised down”. Yields of 10-year Treasury bonds in interbank market climbed to an intra-session high of 3.81 percent, the highest since December 2014. Yields of CFFEX's benchmark 10-year Treasury futures fell to a eight-month low by 0.3 percent during one point. Market morale remained weak though both spot bonds and futures steadied.

Stock Market
1. U.S. Equities
The Dow and S&P 500 advanced on Thursday after a round of positive corporate earnings announcements, but gains were curbed and the Nasdaq lost ground on a drop in the healthcare sector. The Dow Jones Industrial Average rose 71.40 points, or 0.31 percent, to 23,400.86, the S&P 500 gained 3.25 points, or 0.127 percent, to 2,560.40 and the Nasdaq Composite dropped 7.117 points, or 0.11 percent, to 6,556.774.

2. Hong Kong Equities
Hong Kong stocks softened on Thursday after Wall Street pulled back from record highs amid concerns of tighter liquidity in global financial markets ahead of a European Central Bank meeting. Both the Hang Seng index and the China Enterprises Index lost 0.4 percent, to 28,202.38 and 11,446.21 points, respectively.

3. China Equities
China's stocks rose to an almost 22-month high on Thursday, extending gains to the fifth consecutive day. Major indexes, led by bellwether names, tested the key mark of 3,400 once again without triggering selloff of other sectors, suggesting a resilient sentiment, traders said. Blue-chips led by Guizhou Maotai posted solid results, boosting market morale. The Shanghai Composite Index settled at 3,407.57, up 10.67 points or 0.31 percent, approaching previous highs at 3,539.18 hit on December 31 2015. The trading volume surged to 238.3 billion yuan from 159.8 billion yuan. The CSI 300 closed up 0.42 percent to 3,993.58.