MARKET WRAPS

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Empire State Manufacturing Survey,

Opening Call:

Stock futures rose, indicating that stocks would open with gains to start the week, while government bond yields fell.

Despite price pressures that have lingered longer than many investors expected, major indexes are still close to record highs. Companies that have reported earnings so far have broadly beaten analysts' expectations, supporting stock prices. Higher inflation has also suppressed the returns on government bonds, a main alternative to stocks.

"People were quite worried about third-quarter earnings, but we've come through it very strongly," said Edward Smith, co-chief investment officer at U.K. investment firm Rathbone Investment Management.

Tyson Foods, WeWork and Warner Music Group are set to report quarterly results before the opening bell.

Advance Auto Parts and Lucid Group are slated to post earnings after the market closes. Tyson Foods, WeWork and Warner Music Group are set to report quarterly results before the opening bell. Advance Auto Parts and Lucid Group are slated to post earnings after the market closes.

In premarket trading, Dollar Tree added 4% after The Wall Street Journal reported Friday that activist investor Mantle Ridge has a stake of at least $1.8 billion in the discount retailer and plans to push it to act to boost its share price.

Overseas, the pan-continental Stoxx Europe 600 edged higher. Shares of Spanish bank Banco Bilbao Vizcaya Argentaria fell more than 4% after it said it would launch a takeover bid for financial-services company Turkiye Garanti Bankasi for the equivalent of around $2.6 billion. The move runs contrary to what many investors had expected, given uncertainty over Turkey's outlook amid rising inflation and a weakening currency.

Forex:

The DXY dollar index edged lower, pulling away from Friday's highest level since July 2020 as investors take profit on its recent strong gains, but analysts expect this won't last long and it will soon rise further.

Last week's strong U.S. inflation data fuelled speculation that the Federal Reserve "may have to move faster and more aggressively" by accelerating asset-purchase tapering and looking to raise interest rates, ING said.

"We don't see a clear catalyst to drive a material correction in the dollar this week," ING said.

This week, investors will watch U.S. retail sales and industrial production, as well as speeches by Fed officials, it said.

Sterling could strengthen as U.K. economic data later this week should support the case for an imminent interest rate rise while investors shrug off Brexit risks, ING said.

U.K. jobs data on Tuesday and inflation data on Wednesday should make markets and the Bank of England "more comfortable with a December rate hike call," ING analysts said.

Meanwhile, the market is reluctant to price in any Brexit-related risk premium on sterling despite the EU's threats to retaliate if the U.K. suspends parts of the Northern Ireland protocol, they said.

"We see the balance of risks tilted to the downside in EUR/GBP in the near term, with room for a move below 0.8500."

Bonds:

In bond markets, the yield on the benchmark 10-year Treasury note ticked down to 1.546% from 1.583% Friday.

As key developed-market central banks push back in unison on the idea that higher interest rates are imminent in order to fight inflation, J.P.Morgan Asset Management is more confident in a prolonged and orderly rise in rates following the unwinding of asset purchase programs globally, it said.

"So long as rates rise in a measured fashion, we believe short duration positioning coupled with a bias to risk assets should be monitored," JPM AM said.

The asset manager anticipates tactical opportunities across the curves as the market is repricing the trajectory of central bank interest rate rises in tandem with economic data prints over the coming months.

Eurozone government bond yields are traded lower early Monday amid renewed risks of economic growth, analysts said.

"Bunds should remain better supported as lockdown fears highlight growth risks while the collateral scarcity and asset swap widening extend," Commerzbank's rates strategists said.

They expect European Central Bank President Christine Lagarde to "further resist the market's rate hike pricing" in her testimony before a European parliament committee.

Commodities:

Oil prices were down, with DNB Markets' Helge Andre Martinsen citing "continued speculations regarding a U.S. [Strategic Petroleum Reserve] release," after Senate Majority Leader Charles Schumer said at the weekend that President Biden should release crude from the country's emergency reserves amid energy-price inflation.

Still, Martinsen noted remarks from the Saudi Energy Minister that he expects oil inventories to build from next month. Elsewhere, benchmark European gas prices are up 5% at EUR79.70 per megawatt hour with investors watching out for auctions on Monday for December pipeline capacity through Poland and Ukraine.

Metals fell, tracking coal prices, and amid fresh concerns over China's embattled property companies. Concerns about struggling Chinese real-estate firms were weighing on sentiment, Marex said.

Sunac China said Sunday that it would issue shares and sell off a stake in its property-management unit in an attempt to pay off its debts. Kaisa Group said it was scrapping its dividend.

"The question now is whether there is enough cash to be had for the Chinese developers to escape a liquidity crisis," said Marex. Chinese coal prices were under pressure, which was also dragging down metals prices, said Marex. China's metals producers require the fuel to power their smelters.

TODAY'S TOP HEADLINES

Shell to Move HQ to London, in Historic Shift Amid Energy Transition

LONDON-Royal Dutch Shell PLC said it plans to consolidate its dual British and Dutch structure and move its headquarters to London, a historic shift the oil giant said would help it navigate the transition to low-carbon energy.

The company said Monday that the plan to end its long-held, complex dual structure was intended to make it easier for investors to value the company, help it facilitate returns to shareholders and make it simpler to amend its portfolio of assets.

Airbus Says It Can't Meet Current Demand for Single-Aisle Jets

DUBAI-Airbus SE said it can't ramp up production of its popular single-aisle jet fast enough to meet demand and forecasts delivery constraints for another three years as airlines clamor for new planes again.

Airbus Chief Financial Officer Dominik Asam, in an interview ahead of the Dubai air show that started Sunday, said airlines are asking for delivery of new aircraft after most of them stopped ordering new jets and tried in many cases to defer or cancel orders during the Covid-19 pandemic. Airbus is pushing sales-what the industry calls sales "campaigns"-but is constrained on what it can promise, Mr. Asam said.

Chip Shortage Has Manufacturers Turning to Lower-Tech Models

Manufacturers struggling with a shortage of semiconductor chips are finding workarounds, executives said, redesigning products, shipping uncompleted units and focusing on older, lower-tech models.

After pushing for years to add digital features like screens and wireless connectivity, makers of appliances and vehicles are reversing, temporarily, to continue supplying products to dealers and consumers amid a shortfall in semiconductors that industry officials project will last into next year.

Fight Over 5G and Aviation Safety Clouds Big Investments by AT&T, Verizon

An unusual public dispute among federal agencies is playing out in Washington, delaying the rollout of 5G cellphone services and revealing government infighting that has plagued two U.S. administrations.

AT&T Inc. and Verizon Communications Inc. earlier this month said they would delay the launch of some fifth-generation wireless services after the Federal Aviation Administration warned it could restrict U.S. airspace in bad weather if the networks were turned on as planned in December. The FAA warning came in the thick of cellphone carriers' network upgrade projects.

Property Developer Sunac China to Raise $952 Million

Property developer Sunac China Holdings Ltd. is raising 7.42 billion Hong Kong dollars (US$952 million) to partly repay its debt.

The company will raise a total of HK$5.09 billion by issuing 335 million shares for HK$15.18 each and another HK$2.33 billion by selling a 5.1% stake in its unit Sunac Services Holdings Ltd., the company said late Sunday.

Trumps Selling Prized Washington, D.C., Hotel for $375 Million

Donald Trump's family hotel company has reached an agreement to sell the rights to its Washington, D.C., hotel for $375 million, according to people familiar with the matter.

CGI Merchant Group, a Miami-based investment firm, is in contract to acquire the hotel lease for the Trump International Hotel, which is located a short walk down Pennsylvania Avenue from the White House. CGI intends to remove the Trump name, and it has reached a deal with Hilton Worldwide Holdings Inc. to have the property branded and managed by Hilton's Waldorf Astoria group, these people said.

Covid-19 Created a Child-Care Crisis, and Big Providers Aim to Fill the Void

The biggest players in U.S. child care see an opening in America's caregiving crisis.

National operators such as KinderCare Education and Bright Horizons Family Solutions Inc. are buying up closed centers, reaching out to parents who lost care during the pandemic and signing contracts with employers to provide nannies and daycare for their workers.

Biden Weighs Choice of Jerome Powell or Lael Brainard as Fed Chair

President Biden is expected to decide as soon as this week whether to appoint Federal Reserve Chairman Jerome Powell or governor Lael Brainard to a four-year term leading the central bank beginning next February.

(MORE TO FOLLOW) Dow Jones Newswires

11-15-21 0612ET