I. Yesterday's News
1. Japan's parliament approved on Tuesday a $32 billion extra budget for this fiscal year that will help fund Prime Minister Shinzo Abe's economic stimulus package. This, the second supplementary budget for the year that ends in March 2017, will be mostly funded by 2.75 trillion yen in construction bonds to finance infrastructure spending.

2. Bank of England policymaker Michael Saunders said on Tuesday he would not be surprised if the pound fell further, but the BoE could overlook the effect of weak sterling on inflation, possibly for years. Sterling extended losses while Saunders and Kashyap spoke. The British pound jumped 0.8 percent in early Asian trading on Wednesday, bouncing back from a low below $1.20 touched in late U.S. trade the previous day. Some market players suspect sterling benefited from a report that British Prime Minister Theresa May has accepted that Parliament should be allowed to vote on her plan for taking Britain out of the European Union.

3. New Zealand's central bank reiterated on Tuesday that further policy easing will be needed to ensure that the inflation rate increases and settles near the middle of its target range. In a speech, Assistant Governor John McDermott said inflation has been kept low by a weak global economy, which sent the New Zealand dollar higher. He expected that inflation would rebound in the fourth quarter to the lower end of the central bank's target. The kiwi dollar fell to $0.7062 from 0.7100 before paring losses at 0.7072.

4. Samsung Electronics' worst-ever recall could cost the company as much as $17 billion after it halted sales of its flagship Galaxy Note 7 for a second time, spelling an almost certain end for the ill-fated premium model. As the world's top-selling smartphone company awaits results of probe by U.S. safety regulators, some investors and analysts predict Samsung may scrap the Note 7 and move on to successor models to limit the financial and reputational damage. Samsung will likely stop Note 7 sales permanently, a source familiar with the matter said. China's quality watchdog said on Tuesday Samsung's local unit will recall all 190,984 Galaxy Note 7 phones that it has sold in the mainland. Samsung's share price plunged 8.0 percent, dragging the market down.

5. OPEC will hold talks with non-member oil producers on Wednesday in a bid to hammer out details of a global agreement to cap production for at least six months as Russia lent its support for the plan. Ministers from OPEC members embarked on a flurry of talks at an energy conference in Istanbul to shore up support for the OPEC deal they agreed in Algeria last month hoping to adopt it at the end of November. Any deal would initially be applied over six months and then reviewed, OPEC Secretary General Mohammed Barkindo said.

6. Yum Brands Inc said it can triple the number of restaurants in its China division, which is being spun off after a string of sales setbacks that have raised the risk profile of the company's top profit generator. "I really don't see any reason why we cannot have 20,000 restaurants in China," said Micky Pant, chief executive of Yum's China division. Yum now has more than 7,300 KFC and Pizza Hut outlets in China.

II. Market Overview
FX
The dollar surged to a seven-month high against a major currency basket on Tuesday, as investors increased bets the Federal Reserve would raise interest rates in December following a round of generally solid U.S. economic data over the last few weeks. In late trading the dollar index, which measures the greenback against six major currencies, rose 0.8 percent to 97.650 after hitting its highest since March. The euro fell to a more than two-month low against the dollar, and was last down 0.8 percent at $1.1054. Against the yen, the dollar slipped 0.3 percent to 103.38 , but has gained two percent so far this month. The British pound fell 1.8 percent to $1.2128.

Precious Metals
Gold prices fell on Tuesday as the dollar strengthened on increasing bets that the Federal Reserve will raise U.S. interest rates in December. Spot gold closed at $1,255.9 an ounce, while U.S. gold futures settled down 0.4 percent at $1,255.9 per ounce. Among other precious metals, spot platinum was down at $944.99 an ounce after falling to a six-month low at $941.90.

Commodities
1.Crude Oil
Oil prices on Tuesday retreated from one-year highs, after OPEC said it was trying to reach a global agreement to cap production for at least six months amid doubts about how much that would reduce a crude glut. On Tuesday, Brent crude settled down 73 cents, or 1.4 percent, at $52.41 a barrel, retreating from a one-year high of $53.73 hit on Monday. U.S. West Texas Intermediate (WTI) crude fell 56 cents, or 1 percent, to settle at $50.79.

2. Base Metals
Aluminium prices hit two-month highs on Tuesday before retreating on profit-taking as the spotlight returned to oversupply and expectations of rising output in China. Benchmark aluminium ended down 0.7 percent at $1,679 a tonne. The metal used in transport and packaging had earlier touched $1,693, it highest since Aug. 18. Copper ended down 0.7 percent at $4,812 a tonne. Zinc slumped 3.4 percent to end at $2,250.

U.S. Treasuries
U.S. Treasury yields rose to a four-month high on Tuesday in technical trading that squared the market with a fall in Treasury futures prices the day before when the cash market for bonds was closed for the Columbus Day holiday. Benchmark 10-year Treasury notes last down 5/32 in price to yield 1.75 percent. Yields on the 10-year note had risen to 1.78 percent, the highest since June. The 30-year Treasury bond was last down 14/32 in price to yield 2.49 percent.

Stock Market
1. U.S. Equities
Wall Street sold off on Tuesday as disappointing corporate reports gave a sour tone to the start of earnings season and investors digested possible changing dynamics for the upcoming U.S. Elections. The Dow Jones industrial average fell 200.38 points, or 1.09 percent, to 18,128.66, the S&P 500 lost 26.93 points, or 1.24 percent, to 2,136.73 and the Nasdaq Composite dropped 81.89 points, or 1.54 percent, to 5,246.79.

2. Hong Kong Equities
Hong Kong stocks fell more than 1 percent on Tuesday as investors took profits after a strong rally over the past few months. Most sectors fell on Tuesday, with property shares leading the decline as more Chinese cities imposed restrictions on home buying. The Hang Seng index fell 1.3 percent to 23,549.52 points, while the China Enterprises Index lost 1.2 percent to 9,804.47.