Daily Sphere · Thu Nov 5

Daily Sphere Brief · What comes nextA rate call, a budget and a Congress that wants the war overThe Bank of England is expected to raise rates today, Ottawa tables its budget, US jobs data lands Friday and Ukraine talks open in Abu Dhabi on Tuesday.

$93.63Brent in Thursday trading, extending a sharp retreat on bets the Iran war winds downGulf News, Nov 5

~80%Market-implied odds of a quarter-point Fed hike in December, ahead of Friday's jobs dataTradingKey, Nov 5

C$67.8bnCanada's 2030-31 deficit in the budget officer's projection, against Ottawa's C$53.2bnBNN Bloomberg (CP), Nov 4

This week

Thu · Bank of England. Economists polled by Reuters expect Bank Rate to rise to 4% from 3.75% on a 7-2 vote, the first hike since August 2023. Inflation reached 3.5% in September. The guidance on further rises matters more than the move.
Thu · Canada's budget. Finance Minister François-Philippe Champagne tables it today. The budget officer sees the deficit rising to C$67.8bn by 2030-31, while Ottawa's spring plan had it falling to C$53.2bn. Watch the split between capital and operating spending.
Fri · US jobs. October payrolls are forecast near 65,000 with unemployment at 4.2%, after 29,000 in September. A soft number would test the market's bet on a December hike.
Mon · COP31 opens. Climate talks run in Antalya from Nov 9 to 20, with leaders meeting Nov 11-12. Costly fuel and tight budgets will shape what richer countries put on the table.
Tue · Abu Dhabi talks. US envoy Steve Witkoff lists post-war security, de-escalation, humanitarian measures and ending the war on the agenda for Ukraine-Russia talks on Nov 10-11. A limit on strikes against energy would be a useful first result.

Storylines to watch

Hormuz, day 251. The Revolutionary Guards claim two tankers and a tug caught fire as Trump weighs a large strike. Qatar's draft agreement is still in play; whether either side moves on the blockade decides the next week.
Sudan, day 1,301. Drones are now hitting fuel stations in Kordofan as well as power plants. Without a pause in attacks on fuel and power, winter food and water supplies will suffer most.
Ukraine's winter. Kyiv says Russian drones targeted a substation that serves the Khmelnytskyi nuclear plant. Ukrainian and Western officials are pressing for a halt to energy strikes; Abu Dhabi next week is the first test.
Ebola in Congo. The outbreak has killed 5,376 people, nearly all in Congo, among 10,444 cases of the Bundibugyo strain. The vaccine on trial is not yet proven against it, so tracing and safe burials still carry the response.
Israel's next government. Herzog has until Nov 11 to name a candidate once consultations, which may run into Friday, end. Netanyahu's bloc holds 53 seats and Eisenkot's 48; neither reaches 61 alone.

Daily Sphere's read on what comes next, drawn from linked reporting.

Top 5

1Trump threatens a large strike on Iran as Tehran claims more tanker fires in HormuzMiddle East · WorldBrent, Thu $93.63Day 251IRGC claims

Iran's Revolutionary Guards said two oil tankers and a tugboat caught fire in separate incidents as vessels used "unauthorised routes" through the strait, Reuters reported. No ships were named and the claim has not been independently confirmed.
Trump told Fox News the US may deliver a heavy hit: "We have to do something large," Gulf News reported. He called Vance's view that the war cost Republicans the midterms "largely true". He also said "we had to do it", Al Jazeera reported.
Mediators are pursuing a framework under which Iran would halt attacks in the strait and the US would lift its blockade, regional officials told AP. There were 30 attacks on commercial vessels in the region in October, a record, CBS reported.

The vote has changed the mood faster than the facts. Oil has fallen on hopes of a US retreat, yet Trump is still weighing escalation and Iran is still claiming hits on shipping. The interim swap of a halt in attacks for an easing of the blockade is the most realistic way to bank the calm before either side tests it.

Yahoo News (Reuters) · Gulf News · Al Jazeera live · AP via WMTV

2Drones hit fuel stations in Kordofan as Sudan's power output falls to a quarter of pre-war levelsAfricaDay 1,301Government claims

A drone that local sources attribute to the RSF struck a crowded fuel station in Naqli al-Abbasiya, South Kordofan, killing more than 10 civilians, Darfur24 reported; neither the toll nor the attribution could be independently verified. Another drone destroyed two fuel stations in Al-Rahad, North Kordofan, with no casualties reported.
Sudan's power output has fallen to 1,100 MW from 4,400 MW before the war, and a rights group counts 15 substations targeted since early October, AP reported. The war has killed at least 59,000 people and displaced about 13 million.
Khartoum claims 187 drones were launched at Sudan from Ethiopian territory between February and October; Ethiopia denies it, Al Jazeera reported.

The war has turned on the systems that keep people alive: power for water pumps, fuel for bakeries and clinics. A truce limited to energy and fuel sites would be easier to agree than a full ceasefire and would spare millions the worst of the coming months. Regional rivalries, now including Ethiopia, make outside pressure more urgent.

Darfur24 · Darfur24 · AP via DTN · Al Jazeera

3Democrats eye the power of the purse to curb the Iran war when they take Congress in JanuaryAmericasCounts still provisional

NBC News projections give Democrats 54 Senate seats to 44, with Alaska and Mississippi uncalled, and 258 House seats to 177, NBC Chicago reported. House leader Hakeem Jeffries said "We will win at least 255 seats, if not more," according to CBS.
Senate Democratic leader Chuck Schumer said the "power of the purse" is one way to deter a president who wages war without public consent, the Times of Israel reported.
Options include a binding war-powers resolution, blocking new war funding and oversight hearings, Al Jazeera reported. Democrats look unlikely to reach the two-thirds needed to override vetoes, Reuters reported.

Who says what

Chuck Schumer, Senate Democratic leader

"This war must end. It must end."

Donald Trump, President

Admits the war cost Republicans, but "we had to do it."

Congress controls money, not command, and the new majorities arrive only in January. Without a veto-proof margin, Democrats' strongest lever is the spending bills the government needs to keep running. Using that lever to push for a negotiated end, rather than a shutdown fight, would serve markets and allies alike.

NBC Chicago · CBS News live · Times of Israel · Al Jazeera · Reuters via Central Oregon Daily

4Herzog's coalition talks continue as Eisenkot edges closer to a mandateMiddle East

Herzog accepted the certified results: Netanyahu's bloc has 53 seats, Eisenkot's 48, and Ra'am with the Joint List a record 19, Al Jazeera reported. A majority needs 61. "The elections are over. Now is the time to face reality," Herzog said.
Ynet projects 60 recommendations for Eisenkot and 46 for Netanyahu, with Ra'am and the Joint List likely to back Eisenkot but not yet formally declared.
Herzog's legal deadline to pick a candidate is Nov 11, Ynet reported. The nominee then has 28 days, with a possible 14-day extension.

Al Jazeera · Ynet

5Fitch turns negative on France as unions strike over the 2027 budgetEurope

Fitch affirmed France at A+ and cut its outlook to negative, EconomyNext reported. It sees a 2027 deficit of 5.5% of GDP against the government's 5.0% target and debt near 124% of GDP by 2028, citing political fragmentation.
Five unions, CFDT, CGT, FO, UNSA and FSU, are striking on Thursday against €54bn of savings and freezes on benefits and civil-service pay, Sortir à Paris reported. Rail and schools are hit hardest; the Paris metro runs mostly normally.

EconomyNext (Fitch) · Sortir à Paris

The view

The vote gives Washington and Tehran a reason to bank a pause

Markets already price a retreat from the Iran war. The politics have not caught up, and an interim deal is the bridge.

Both sides in the Iran war are reading the same election. Vice President Vance said "The reason we lost is the war," and Trump called that largely true. Senate Democratic leader Chuck Schumer now talks of using the power of the purse. Oil traders moved first: Brent fell from $113.43 on Oct 30 to $94.62 on Wednesday.

That reading may be early. Trump told Fox News "We have to do something large," and the Revolutionary Guards claimed two more tankers and a tug caught fire overnight. Democrats take control of Congress only in January. Until then the decision to strike or negotiate rests with the president, and Iran's supreme leader says anyone expecting partisan shifts to change US policy is mistaken.

Waiting has a price. UKMTO counted a record 30 attacks on merchant ships in October. Airlines, importers and crews pay through fuel, freight and risk, and Lebanon stays a front that Iran wants any deal to cover.

What would work is the framework mediators are pursuing: Iran halts attacks in the strait while the US lifts its blockade. The harder questions of sanctions and frozen assets would follow. Each side can present that at home as strength. It would also hand the new Congress a pause to sustain rather than a war to defund.

Brent settlements. Oct 30 and Nov 3 from Global Oil Shock; Nov 4 from AP. Not every session is shown.

Daily Sphere's analysis, drawn from: Al Jazeera · Gulf News · Times of Israel · CBS News · AP via WMTV · Yahoo News (Reuters) · Al Jazeera (Democrats) · Al Jazeera (Khamenei)

From X & beyond

“American intervention regarding Iran carries very heavy consequences”Jordan Bardella, leader, National Rally (France) · Nov 4

Bardella was among European nationalist leaders who distanced themselves from Trump after the midterms. Italy's Matteo Salvini said the result "was influenced above all by the wars, international tensions and the increase in the cost of living".

Post: Yahoo News (Reuters)

“That will be one of the sticking points for the remaining two years of President Donald Trump's term.”Tai Hui, chief market strategist for Asia-Pacific, J.P. Morgan Asset Management · Nov 4

Hui was referring to Democrats' likely lack of the two-thirds majority needed to override vetoes, which points investors toward gridlock.

Post: Reuters via Central Oregon Daily

“when that tide goes out, we're going to see who's not wearing their swimsuit”Randall Bartlett, deputy chief economist, Desjardins · Nov 4

Bartlett was previewing Canada's budget, warning that fading oil prices will expose the true state of federal finances. Desjardins estimates about C$50bn of planned new spending over the coming decade has been announced since April.

Post: BNN Bloomberg (CP)

“Without strong second-round effects on core inflation, we see this tightening as a risk-management calibration”Peder Beck-Friis, economist, PIMCO · Nov 5

He was describing the Bank of England's expected hike. PIMCO expects one more rise in February 2027 and then a long hold, fewer than markets price.

Post: RTÉ

“Open the roads and let them through. Civilians cannot be held hostage by the fighting.”Tom Fletcher, UN humanitarian chief · Nov 2

Fletcher was speaking about Yemen as Houthi forces advance and Taiz remains cut off. He said 70 UN staff remain detained.

Post: The National

Infographic

Yemen

In besieged Taiz, most people cut off from care are under five

With every road into Taiz closed, nearly 250,000 people cannot reach healthcare. More than 186,000 of them are children under five.

Children under fiveOthers

~3 in 4of those cut off from healthcare in Taiz are children under five

5xRise in prices of essential goods, at most

12Hospitals at risk of closing

1,400+Cases of acute diarrhoea and suspected cholera in one week

OCHA figures. 186,000 of nearly 250,000 is about 74%; shown as 15 of 20 icons (75%), rounded. The price rise is OCHA's "as much as fivefold".

Sources: UN News · Arab News

Latest updates

UN says nearly 310,000 Yemenis have fled fighting since AugustNov 4Middle East

The UN said nearly 310,000 people have been displaced since early August and aid trucks are stranded, Arab News reported. UNICEF said an attack on a health centre in Lahj reportedly killed five, including health workers.
Four military sources told Reuters that Houthi forces had come within 80km of Aden, their closest point since 2015, The National reported.

Yemen's war is widening again as the Houthis push south. Opening the roads into Taiz is the cheapest way to save lives now; donors should fund the aid that is already stuck at the edge of the city.

Arab News · The National

Kyiv says Russian drones targeted a substation serving the Khmelnytskyi nuclear plantNov 4EuropeUkrainian claims

Energy Minister Denys Shmyhal said Russia aimed three drones at a substation critical to the plant, calling it "a serious step of escalation"; the IAEA was informed, HNGN reported.
Ukraine's air force said Russia launched 310 drones overnight into Wednesday and 272 were downed or suppressed, The Defense Post reported. Zelensky held a 90-minute call with Steve Witkoff and Jared Kushner before next week's talks, per Kyiv Post.

Strikes near nuclear infrastructure raise the stakes of the grid war for all of Europe. A limit on attacks against energy sites is the most achievable outcome for Abu Dhabi and the one that would spare civilians most this winter.

HNGN · The Defense Post · Kyiv Post

Hong Kong rallies while the Kospi slides on chipmakers after the US voteThu AsiaAsiaHang Seng +2.8%Kospi −3.5%Late-morning figures

The Hang Seng rose 2.8% to 24,597.59 and Australia's ASX 200 gained 1.9% , AP reported. In late morning the Kospi was down 3.5% at 5,484.38 on selling of chipmakers, the Nikkei 225 slipped 0.5% and Taiwan's Taiex lost 1.6%.
The dollar fell to 157.96 yen from 158.41, and the euro rose to $1.1256.

AP via WSLS

Emirates' half-year profit falls 66% as the Iran war cuts trafficNov 5Middle EastNet profit −66%

The airline's profit for the six months to Sept 30 fell to Dh3.3bn ($903m), revenue fell 13% and passengers fell 22% to 21.8 million, The National reported. Its seat factor dropped to 72% from 79.5%.
Emirates was flying 91% of its pre-disruption network by the end of September, Reuters reported.

The National · The Star (Reuters)

Feature · Africa's debt

Africa's debt map splits: Ghana and Zambia climb as Senegal slides

In one week, an IMF review and a ratings upgrade rewarded two countries that restructured, while a fifth downgrade marked Senegal's turn to debt relief.

Zambia's Moody's rating, positive outlookCaa1Up from Caa2, Oct 30

Ghana's inflation in October5.5%IMF staff deal on first PCI review, announced Nov 5

Senegal's Moody's ratingCaFifth downgrade, from Caa2, Nov 2

Senegal's next stepCommon FrameworkDakar seeks G20 debt treatment

Ghana and Zambia are further along the road Senegal is starting. IMF staff reached agreement with Ghana on the first review of its Policy Coordination Instrument, with inflation at 5.5% in October and growth seen at 5.7% this year. Moody's lifted Zambia to Caa1 with a positive outlook after an IMF staff deal in October on a $1.47bn programme, which still needs board approval.

Senegal is moving the other way. Moody's cut its foreign-currency rating to Ca, the fifth downgrade, after Dakar said it would seek treatment under the G20 Common Framework, and it expects substantial losses for private creditors. The examples of Accra and Lusaka suggest that the faster creditors agree on terms, the sooner ratings and borrowing costs can recover.

Citi Newsroom · Zambia Daily Mail · AllAfrica

MoneyDebt, deficits, taxes and what governments spend

US Treasury holds auction sizes and drops its "at least" pledgeAmericas

Treasury will sell $125bn next week in 3-, 10- and 30-year debt, and now says sizes stay unchanged "for the next several quarters", Reuters reported. Analysts read it as opening the door to size changes in early 2027, with possible increases in shorter maturities and cuts to the longest.
Treasury also expects up to $70bn of buybacks.

A government that borrows every week now faces a split Congress and a costly war. Signalling bigger auctions early lets investors prepare, but the cheapest fix for borrowing costs is a budget deal that removes shutdown risk.

Reuters via 93.3 The Drive

The dollar sinks to its weakest since September as oil and yields fallGlobal

The dollar index fell to 101.25, its weakest since late September, Rallies reported, as the 10-year Treasury yield eased to about 4.85%.
Futures still price about an 81% chance of a December Fed hike, Schwab said, citing CME FedWatch; the odds moved little on the election results.

A weaker dollar and cheaper oil are relief for importers from India to Egypt. It will last only if the war calms; Friday's US jobs report is the next test.

Rallies · Schwab

Jordan and the IMF reach a staff deal that could free about $294mMiddle East

IMF staff agreed on reviews of Jordan's Extended Fund Facility and Resilience and Sustainability Facility, Arab News reported. "Jordan's economy has continued to demonstrate resilience," said Cesar Serra of the IMF.
The payout needs approval by IMF management and the executive board.

Arab News

Norway's central bank holds at 4.50% and signals it could raise againEuropeSingle source

Norges Bank kept its policy rate at 4.50% and said a further increase is possible, Rallies reported. Core inflation was 3.0% in September.

Rallies

GeopoliticsWho is aligning with whom, where they clash, and what's been agreed

Europe's nationalist right distances itself from Trump over the Iran warEurope

Leaders including France's Jordan Bardella, Germany's Alice Weidel and Italy's Matteo Salvini linked the US result to the Iran war, Reuters reported. Weidel said "This broken promise has now come back to haunt the Republicans".
Dan Dungaciu, vice-president of Romania's hard-right Alliance for Uniting Romanians, said "Donald Trump does not automatically become a powerless president."

The war has become a liability for Trump's allies abroad as well as at home. European governments that want Washington engaged on Ukraine will now find a wider audience for diplomacy over force in the Gulf.

Yahoo News (Reuters)

Moscow and Beijing keep their distance from the US resultEurope

Russian Deputy Foreign Minister Sergey Ryabkov said Moscow would wait for final results and noted Democrats' "sharply negative" approach to Russia, Al Jazeera reported.
China's foreign ministry called the vote a "domestic affair" and said Beijing would keep building a "constructive strategic relationship".

Al Jazeera

Syria and Saudi Arabia sign a defence deal and $403m in loansMiddle East

President Ahmed al-Sharaa and Crown Prince Mohammed bin Salman oversaw a defence cooperation deal in Riyadh whose terms were not disclosed, Al Jazeera reported. The Saudi Fund for Development agreed $403m in concessional loans, including $105m for civil defence and $100m for health.
Foreign Minister Asaad al-Shaibani said talks were under way on Syria joining the "Mecca alliance".

Riyadh is binding Damascus into its camp with money and security ties while Iran is tied down. Loans for clinics and civil defence are where Syrians will judge the deal.

Al Jazeera

Jurists' group condemns the takeover of Poland's constitutional courtEurope

The International Commission of Jurists said the takeover "contravenes international standards on the independence of the judiciary", Notes from Poland reported. On Nov 3 the eight government-backed judges advanced disciplinary steps against the chief justice and deputy they had declared suspended.
It is not yet known whether Tusk and President Nawrocki will meet, as Tusk offered.

Each step taken without the president widens the legal doubt over the court's rulings. A negotiated way of naming judges would serve Poland's investors and EU partners better than a win for either camp.

Notes from Poland

UN elects five judges to the International Court of Justice, including Kenya's Phoebe OkowaAfrica

The General Assembly and Security Council elected Dapo Akande (UK), François Alabrune (France), Mahmoud Hmoud (Jordan), Rena Lee (Singapore) and Phoebe Okowa (Kenya), Al Jazeera reported. Okowa won after Ecuador's Marcelo Vázquez-Bermúdez withdrew.
Their nine-year terms begin on Feb 6, 2027.

Al Jazeera

Chart of the day

Ottawa and its budget watchdog disagree on where the deficit is heading

Federal deficit projections, C$bn

Government figures from the spring economic statement; PBO figures from its latest outlook, both as reported by BNN Bloomberg (CP) on Nov 4, before today's budget.

Law & businessCourt rulings, regulation, rules and the big corporate moves

US Treasury sanctions an India-based network accused of giving Iran's tankers false flagsAsia

OFAC designated 5 people and 10 entities, mostly India-based ship managers and registries, plus a Turkish ground-services firm, and issued an alert on the shadow fleet's use of false flags, OFAC said. A Chandigarh couple allegedly issued flags claiming to represent Guyana, Eswatini and Laos, The Federal reported.
The same action issued Venezuela General License 5AA, covering PdVSA's 2020 bond from Dec 18.

Washington is targeting the paperwork that lets sanctioned tankers sail. Flag registries and insurers in third countries now carry more legal risk, which raises the cost of Iran's oil trade more than another list of ships would.

OFAC · The Federal

EU court adviser says chatbot answers can infringe press publishers' rightsEurope

Advocate General Maciej Szpunar advised the Court of Justice in Like Company v Google (C-250/25) that Gemini's outputs may engage the press publishers' right, and the "very short extracts" exclusion does not apply automatically, IPKat reported.
He proposed that the training questions be declared inadmissible, though he said the text-and-data-mining exception could in principle cover training where access is lawful and rights are not reserved. The Court's judgment comes later; two more AI copyright cases are pending.

If judges follow the opinion, AI firms in Europe would need licences for news they reproduce in answers. That would shift money toward publishers but also raise the cost of AI search in the EU.

IPKat

Britain's competition authority scraps 23 legacy market remediesEurope

The CMA removed 23 remedies in full and 2 in part, and kept 6, after reviewing 31 of 33, the CMA said. Decisions on retail banking and private motor insurance orders will follow later this month.

CMA (gov.uk)

Brazil's competition regulator clears the Saipem-Subsea7 merger if a ship is soldAmericas

CADE approved the deal through a settlement requiring the sale of the pipelay vessel Seven Borealis, The Rio Times reported. No buyer has been named.
EU and Australian approvals are still needed; the European Commission is still reviewing the deal.

Brazil's offshore oil fields depend on a few specialist vessels, so CADE chose a ship sale over a block. Brussels now decides whether the combined firm can go ahead.

The Rio Times

Pretoria court sets aside South Africa's national lottery licence awardAfrica

The High Court overturned Trade Minister Parks Tau's award of the eight-year licence to Sizekhaya Holdings and sent the decision back to him, TimesLive reported. The EFF and losing bidders Ringeta and Ithuba brought the challenge.
The order is suspended so the minister can decide again; no appeal has been reported.

TimesLive