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Briefing.com Summary:

*Indications of imminent policy tightening from Bank of Japan and expectations for tighter policy in Australia and China

*Automakers to see relaxed fuel efficiency standards

*Initial claims drop to level not seen in nearly two years

The stock market faced some early pressure yesterday, but a daylong climb off lows helped the major averages secure a higher finish. The market doesn't have much in its way this morning, leaving futures near their unchanged levels.

The flat standing is a pretty good outcome since the overnight session featured ongoing focus on expected tightening from central banks in the Asia-Pacific region. Expectations for a December rate hike from the Bank of Japan lifted Japan's 10-yr yield past 1.90% to a level not seen since 2007 despite a strong 30-yr JGB auction. The market is also growing more confident that the Reserve Bank of Australia will announce a rate hike sometime next year after the overnight release of a strong Household Spending report for October.

Investors received another sign of a slow policy shift from the People's Bank of China, as Governor Pan published an op-ed in People's Daily, calling for prudent monetary policy, representing a change from the summer when policy was described as moderately loose.

The overnight news flow was on the light side, but it is worth noting that President Trump announced a plan to loosen fuel efficiency standards for passenger vehicles. This has given a big boost to European automakers while U.S. automakers Ford (F 13.16, +0.07, +0.53%) and General Motors (GM 75.09, +0.40, +0.54%) hold modest pre-market gains.

Economic data released this morning was limited to the weekly jobless claims report, which produced a welcome surprise, as initial jobless claims for the week ending November 29 decreased by 27,000 to 191,000 (Briefing.com consensus 220,000) from last week's revised level of 218,000 (from 216,000). This was the first weekly total below 200,000 since January 2024. Continuing jobless claims for the week ending November 22 decreased by 4,000 to 1.939 million from last week's revised level of 1.943 million (from 1.960 million).

The key takeaway from the report is initial claims dropped to their lowest level in nearly two years, which is an encouraging sign about the health of a labor market at a time when visibility remains reduced due to some missing Employment Situation reports from the BLS.

Treasuries set fresh session lows in immediate reaction to the data before recovering some of those losses. Still, the 10-yr yield remains higher by three basis points at 4.09% while the 2-yr yield is up two basis points at 3.51%.