For the third day in a row, China dominated the overnight newsflow with the latest industrial output data, which printed at 5.6% missing expectations of a 5.8% increase, and was tied with March for the lowest print since late 2008. The detailed breakdown: Additionally, electricity output dropped 3.2% on year, the second straight decline, underscoring the impact of the domestic slowdown on heavy industry. Steel and cement output continued to decline. Investment in property development slowed to a 2% pace of growth, the lowest since early 2009 in the depths of the global financial crisis. While housing sales are rising, data suggest most of that is accounted for by developers clearing inventory rather than building new properties. The continued industrial weakness in turn pushed the commodity complex lower, with both copper... ... and the entire universe continuing its recent decline as copper, zinc and nickel are heading for their lowest close in at least six years as slowing growth in China dents demand from the world's largest consumer of energy, metals and grains. The London Metal Exchange index of six industrial metals is set for a third consecutive annual drop, the worst streak since at least 2001. The gauge has sunk 23 percent this year and 50% from its 2011 highs. And while China's fixed investment, commodity-reliant economy, which accounts for about half of the country's GDP, it was a glimmer of good news surrounding China's consumer economy that, together with the plunge protection team pushed stocks into the green in a last hour scramble, when October retail sales were reported a better than expected +11.0% yoy (vs. +10.9% expected), which was up one-tenth from September and the highest annual increase in 9 months. Additionally, vehicle sales jumped 7.1% y/y in October, up from 2.7% in September, and vehicle production turned positive, up 4.9%, for the first time in four months thanks to recent government stimulus meant to boost the local car industry. "The retail sales data were a positive boost to sentiment,” said Ronald Wan, chief executive at Partners Capital International in Hong Kong. "Targeted measures as well as the holiday effect helped with consumption last month. A transition towards consumer-driven economy is taking place, albeit at a slow pace." The retail data also came during China's ‘Singles Day’, a day which initially started during the 1990s by college students in something of a twist on Valentine’s Day and which has now progressed into a mega-day for retail sales in China. In fact, Alibaba has estimated that 1.7m deliverymen, 400,000 vehicles and 200 airplanes will need to be deployed to handle today’s deliveries. The same company announced this morning that it sold some $5bn worth of merchandise in just the first hour and a half of the day. So if you're one of those that has been stunned at how 'Black Friday' has moved from a quaint US event to what is fast becoming a global behemoth then be warned as the marketing men have 'Singles Day' as their next plan for global domination. Ultimately the market decided to focus on the retail sales and to ignore the ongoing collapse in the commodity complex which overnight also led to the latest Chinese default, this time a cement maker China Shanshui Cement Group Ltd, leading to the following markets picture: Market Wrap S&P 500 futures up 0.3% to 2083 Stoxx 600 up 0.5% to 378 MSCI Asia Pacific up 0.2% to 133 US 10-yr yield down 1bp to 2.33% Dollar Index down 0.29% to 99.0 WTI Crude futures down 1% to $43.78 Brent Futures down 0.3% to $47.30 Gold spot down less than 0.1% to $1,089 Silver spot up less than 0.1% to $14.44 Elsewhere in Asia, markets traded mixed following the lacklustre close on Wall St., and unlike China itself, focused on the further weak tier 1 data from China adding to the cautious tone in the region. As noted above, the Shanghai Comp. (+0.3%) traded lower after the headline Chinese industrial production data missed expectations before recovering as participants continue to speculate over further PBoC easing, while the Hang Seng (-0.2%) pulled off worst levels following Tencent earnings. ASX 200 (+0.5%) was underpinned by broad sector gains offsetting the weakness in materials amid concerns surrounding BHP (-2.9 %). Nikkei 225 (+0.1%) traded flat amid light volumes coupled with USD/JPY softening. 10yr JGBs traded lower in a subdued session, while the BoJ entered the market to purchase JPY 1.2trl in government bonds. Asia Wrap: MSCI Asia Pacific up 0.2% to 133 Nikkei 225 up 0.1% to 19691 Hang Seng down 0.2% to 22352 Shanghai Composite up 0.3% to 3650 S&P/ASX 200 up 0.5% to 5123 Top Asian News: Goldman Sachs Sees Start of Shenzhen Link by April, Lau Says: Chinese authorities will probably make announcement on start date by early next year Shanshui Cement Faces Liquidation, Default Hearing: Winding- up petition, application for appointment of provisional liquidators filed with Cayman Court Japan’s Lost Decade Has Lesson for Those Dreading China: Slowdown: Airlines, auto makers profit from Chinese economic slump European equities (Euro Stoxx: +0.6%) have spent the session firmly in the green during European trade with consumer staples the notable outperformer. This comes as AB InBev (+0.8%) made a formal offer for SABMiller (+2.7%) on the day of their 'put up or shut up' deadline. Separately, European equities were also bolstered by dovish comments from ECB's Visco, who largely reiterated comments from ECB's Draghi by stating that the December ECB meeting will see a discussion about a cut to the deposit rate. Just like in China, the main driver behind today's strength was hope in more central bank easing, and as a result Bunds completely reversed initial weakness to trade higher, supported by expectations of further policy easing by the ECB, while PO/GE 10y spread is also seen tighter by 1 bps, having traded wider by 4bps earlier. Of note, DBRS is said to be discussing Portuguese politics in what is considered to be a crucial rating review which might result in bonds being excluded from the ECB QE, as the rating agency is currently the only one of the major four to rank Portugal as investment grade standard. Europe Wrap: Stoxx 600 up 0.5% to 378 FTSE 100 up 0.5% to 6306 DAX up 1% to 10937 German 10Yr yield down less than 1bp to 0.62% Italian 10Yr yield down less than 1bp to 1.69% Spanish 10Yr yield up less than 1bp to 1.87% S&P GSCI Index up less than 0.1% to 351.9 Top European News: Vivendi Plummets as Investors Question ‘Heavy’ Investment Plan: Intends to use a $10-billion cash pile to invest heavily in media and content, raising concerns the plan may limit the return of funds to shareholders down the road Carney Says Bank of England Will Continually Review Regulation: Said in London speech that reform of the financial sector isn’t finished TalkTalk Jumps as Carrier Sees Limited Impact From Hacker Attack: Said it’s on target to meet analysts’ estimates for the year as the co. grapples with fallout from a cyber attack EasyJet Mulls Viability of Sinai Route After Russia Jet Crash: Working on plans for redeploying aircraft from Sharm el-Sheik in Egypt to the Canary Islands and western Mediterranean if there’s a collapse in U.K. demand In FX markets, price action has been dictated by the USD-index which retreated from yesterday's highs amid touted profit taking. Consequently, this supported the greenbacks counterparts which saw USD/JPY break below 123.00 overnight, before recovering modestly in the European session. Elsewhere, AUD/USD saw minor losses after Chinese industrial production printed at a 7-month low. However, the move was later pared due to Chinese retail sales printing at a 9-month high. In the commodity complex, both WTI and Brent crude oil futures reside in negative territory, with the former breaking below the $44.00/bbl handle overnight on the back of the larger than previous API build (6300k vs Prey. 2800k). Of note, the DoE will not release oil inventory data today, due to Veterans Day Holiday. In metals markets, gold prices rose overnight due to the softness seen in the USD-index, however came off best levels since European participants came to market and are now amid touted profit taking after yesterday saw the greenback touch a fresh 7-month high. Elsewhere, copper prices fell following lacklustre Chinese industrial production data as shown in the chart above. Looking at the US calendar, with bond markets closed in the US today for Veterans Day (but equity markets remain open) there’s no economic data due out and also no Fed speakers due to speak. Bulletin Headline Summary from RanSquawk and Bloomberg Chinese industrial production printed at 7 month lows overnight, however sentiment was less downbeat than it otherwise may have been as Chinese retail sales printed at 9 month highs European stocks trade in positive territory, led by consumer staples after AB lbev make formal offer for SABMiller Today could see potentially lighter volumes with CME Pit FX and Rates both closed due to Veterans Day. Top Global News: AB InBev Gets SABMiller for $107 Billion as U.S. Deal Agreed: AB InBev will pay GBP44 in cash for a majority of the stock, confirming a price accord announced on Oct. 13. AB InBev’s SABMiller Deal Backed by $75b Loan, A&O Says: World’s largest-ever loan backs acquisition China Rebalancing Takes Hold as Output Slows, Retail Jumps: China’s industrial output matched the weakest gain since the global credit crisis last month, while retail sales accelerated $1 Billion of Shares Frozen as China Money Manager Xu Probed: Shares frozen in listed companies as authorities probe Xu Xiang, one of the country’s best-known hedge fund bosses, for alleged insider trading and stock manipulation Tullett to Buy ICAP’s Global Hybrid Voice Broking Business: Tullett will issue ~309.9m new shares to ICAP shareholders and the co. to fund the deal Lufthansa Loses Bid to Block Strike as Flights Canceled: Court bid lost, forcing the airline to cancel 931 flights scheduled for Wednesday DraftKings, FanDuel Told by New York to Cease Operations: AG calls the daily fantasy sports sites gambling, illegal under state law EON Posts Record Loss After Billions in Power Plant Writedowns: 9-month underlying net income EU962m vs est. EU995m; 3Q had impairments of EU8.3b Alibaba Sets Singles’ Day Record as Ma Takes Event to Beijing: James Bond star Daniel Craig appears at Singles’ Day event Carlsberg to Cut 2,000 Jobs as Russian Beer Market Shrinks: Aims to reduce annual costs by as much as 2 billion Danish kroner by 2018 and will cut management staff by 15% Apple R&D Plan Will Meet Indonesia Phone Rule, Says Minister: Will enable co. to meet rules requiring locally produced content, allowing Apple to sell smartphones in the country beyond next year Republicans Clash Over How to Prevent Another Financial Crisis: Jeb Bush elbows way back into fray amid debate over immigration, nation’s financial system Sure, IBM Shares Have Gained 3,400,000% But Are They a Buy Now?: Company listed for first time 100 yrs agon on New York Stock Exchange DB's Jim Reid completes the overnight wrap As we go to print this morning part 3 of this week's China data dump has just been released and it’s a bit of a mixed bag. Retail sales during October were up a better than expected +11.0% yoy (vs. +10.9% expected), which was up one-tenth from September. However, industrial production declined last month to +5.6% yoy from +5.7% the previous month and below expectations of a rise to +5.8%. Lastly fixed asset investment was down a tenth last month, although in line with consensus at +10.2% yoy. Chinese equity markets have emerged from the midday break with a negative tone. Declining a bit further post the data, the Shanghai Comp is -0.42% currently and CSI 300 -0.79%. Elsewhere the Hang Seng (-0.07%) has also nudged lower after a positive start, while the Nikkei (+0.17%) is just about in positive territory along with the Kospi (+0.04%). The China data had had little impact on the Aussie Dollar which is unmoved post the prints but up half a percent on the day. Today also marks ‘Singles Day’ in China, a day which initially started during the 1990s by college students in something of a twist on Valentine’s Day and which has now progressed into a mega-day for retail sales in China. In fact, Alibaba has estimated that 1.7m deliverymen, 400,000 vehicles and 200 airplanes will need to be deployed to handle today’s deliveries. The same company announced this morning that it sold some $5bn worth of merchandise in just the first hour and a half of the day. So if you're one of those that has been stunned at how 'Black Friday' has moved from a quaint US event to what is fast becoming a global behemoth then be warned as the marketing men have 'Singles Day' as their next plan for global domination. Also making some noise this morning are more headlines suggesting another Chinese corporate default is on its way. A statement from Chinese cement maker China Shanshui Cement Group has said that it ‘will be unable to obtain sufficient financing on or before’ its maturity date for its $314m (CNY denominated) bonds due tomorrow. The filing, according to Bloomberg, also suggests that this ‘will also constitute an event of default’. The same Bloomberg article also notes that the company will be at least the sixth this year to renege on obligations in the China’s onshore bond market. Despite yesterday’s softer than expected Chinese CPI number, it was a fairly quiet day of price action in markets. After Asian equity markets closed mostly in the red, European markets initially declined into lunchtime, before then rebounding into the close to finish a tad higher (Stoxx 600 +0.10%). It was a similar story across the pond where the S&P 500 (+0.15%) traded with a bit of a softer tone for most of the session (trading as low as -0.4% intraday) before also staging something of a recovery into the close to finish in positive territory for the first time since Tuesday last week. Some gains for utility and health care stocks in particular helped, offsetting a rough day for Apple which fell just over 3% following a negative broker report which indicated potential weakening demand for new products. Meanwhile, despite it being a better day for Oil markets with WTI snapping four consecutive down days to close up +0.78% and back above $44/bbl (although has weakened this morning), the soft China inflation numbers helped precious metals sell-off with the likes of Silver and Platinum down -0.88% and -1.37% respectively. Zinc was also particularly weak yesterday, down -2.25% and to the lowest now since 2009. It was also pretty quiet in the US Treasury market where the benchmark 10y closed more and less unchanged at 2.343% and continues to hover at its three and a bit month highs. 2y yields were also pretty much unchanged at 0.876%, while over at the Fed we heard Chicago Fed President Evans again, this time saying that he would like the Fed’s balance sheet ‘to return to something like a normal balance sheet that is normal for the size of the economy we have today’. The problem with this is that in the c.94 years between the Fed being set up and the GFC, their balance sheet only crept up in real terms before exploding after. So normal should probably be comfortably under a trillion dollars not the c.4.5 trillion they have currently. Such a normalisation is highly unlikely to occur as far as the eye can see. Some of the bigger moves yesterday were again in the European sovereign bond market. 10y Bund yields closed the session down 4.1bps at 0.619% and are now some 7bps down from Friday’s recent six-week high in yield. Similar maturity yields in Portugal rebounded and closed 6bps tighter despite the confirmation that the Centre-Right government was ousted in yesterday’s vote, while yields in Italy and Spain were 6bps and 9bps lower respectively. Some of those moves may have been attributed to the latest comments out of the ECB where Governor Liikanen re-affirmed that ‘the Governing Council is ‘willing and able to act by using all the instruments available within its mandate if warranted’ and that the ‘expanded asset purchase programme is intended to run until the Governing Council sees a sustained adjustment in the path of inflation consistent with the aim of achieving inflation rates below, but close to, 2% over the medium term’. In terms of yesterday’s economic data, the NFIB small business optimism survey for October was unchanged relative to September at 96.1, but a tad lower than expectations of 96.4. The October import price index reading was down -0.5% mom at the headline (vs. -0.1% expected) which puts the YoY rate now at -10.5%. The reading excluding petroleum was soft also at -0.4% mom. There was better news to be had in the latest wholesale inventories data however as they were up +0.5% mom (vs. +0.1% expected) in September. Wholesale trade sales rose +0.5% mom (vs. +0.1%) during the month also. It was a pretty quiet calendar over in Europe too. French industrial production was up +0.1% mom during September after expectations for a decline, helping to lift the YoY rate up to +1.8%. Manufacturing production (0.0% mom vs. -0.5% expected) also beat consensus. Meanwhile in Italy the latest IP report for September was a bit softer than hoped at +0.2% mom (vs. +0.6% expected). Looking at the day ahead now, data-wise in Europe the only release of note this morning will be the latest UK employment data dump where expectations are for no change in the September unemployment rate. Of potentially more importance will be comments from the ECB’s Draghi who is set to speak at a BoE event at 1.15pm GMT along with the BoE Governor Carney. With bond markets closed in the US today for Veterans Day (but equity markets remain open) there’s no economic data due out and also no Fed speakers due to speak.