FRANCE AUCTION RESULTS: MT OATs

Australian Foreign Minister Senator Penny Wong travels to China today for meetings with her counterpart there Wang Yi. This will mark the first trip to China for an Australian foreign minister since 2018, and is seen as a continuation of the thaw in diplomatic relations that have been frozen for some years as China and Australia engaged in a war of words and escalating economic barriers.

• Latika Bourke at the Sydney Morning Herald: "New govt has a softer tone but hasn't shifted an inch on substantive policy. [...] China's MFA spokey hoping the visit will set bilateral relations back on the 'right track.'
  
  (first meaningful change would be China lifting trade sanctions imposed after the WHO inquiry calls by Aust govt). Statement from PM [Anthony Albanese] and [Wong] confirming visit: 'Australia seeks a stable relationship with China; we will cooperate where we can, disagree where we must and engage in the national interest.' Interesting. Australia's Trade Minister Don Farrell says they are not expecting China to lift trade sanctions after first meeting in five years between the two countries' foreign ministers."
• The foreign ministers have met on two separate occasions on the sidelines of international meetings, setting up the November meeting between Chinese Pres. Xi Jinping and PM Albanese on the sidelines of the G20 in Bali, Indonesia.
• The main objective of this meeting for Australia, rather than the removal of trade barriers so soon, is likely to be the establishment of regular dialogues on policy and trade in an effort to foster the thaw and avoid escalation.

EUROSTOXX 50 futures are in a clear bear mode position and today’s move lower has reinforced this theme. The break lower has confirmed a breach of the 50-day EMA - at 3799.60. The break of this average signals scope for an extension lower near-term and this has opened 3720.00 next, the Nov 10 low. On the upside, initial firm resistance is seen at the 20-day EMA - it intersects at 3896.10. S&P E-Minis continue to trade lower and a clear risk-off mood is driving prices lower. The bearish activity has reinforced recent reversal signals - a shooting star candle on Dec 13 followed by a break on Dec 15, of support at 3945.75, the Dec 7 low. The focus is on 3778.45, a Fibonacci projection. On the upside, initial firm resistance is seen at 3952.05, the 50-day EMA. A break of this EMA is required to ease bearish pressure.

• Japan's NIKKEI closed lower by 669.61 pts or -2.46% at 26568.03 and the TOPIX ended 29.82 pts lower or -1.54% at 1905.59.
• Elsewhere, in China the SHANGHAI closed lower by 33.349 pts or -1.07% at 3073.766 and the HANG SENG ended 258.01 pts lower or -1.33% at 19094.8.
• Across Europe, Germany's DAX trades lower by 50.64 pts or -0.36% at 13895.52, FTSE 100 lower by 13.19 pts or -0.18% at 7348.26, CAC 40 down 38.82 pts or -0.6% at 6436.06 and Euro Stoxx 50 down 13.29 pts or -0.35% at 3798.83.
• Dow Jones mini down 32 pts or -0.1% at 32941, S&P 500 mini down 8.5 pts or -0.22% at 3837.25, NASDAQ mini down 42.5 pts or -0.38% at 11152.75.