LONDON (ShareCast) - -EU sending delegates to Spain to look into deficit figures-Expansion
-New Greek bonds said to be trading well below par on grey market.
-Banks deposited €800.6bn overnight at ECB.

FTSE-100: 0.07%
Dax-30: 0.57%
Cac-40: 0.21%
Ibex 35: 0.21%
FTSE MIB: 0.49%

The main European equity benchmarks have begun the day slightly higher; although hesitatingly so, as they have been flittering in and out of the blue during the first hour of trading. That as investors look for direction following last night’s Greek government debt swap.

At 85.5% the up-take on the exchange offer seems to have come in at the high end of what was expected, and most analysts seem to expect a relatively neutral reaction from markets. Nonetheless, there are some observers who are a tad more cautious.

Thus, investors now seem to be waiting on this afternoon’s meeting of the International Swaps and Derivatives Association to determine whether a credit event has occurred or not. They are expected to rule that it has indeed taken place.

Worth pointing out, and evincing that wariness on behalf of traders, the euro/dollar is moving moderately down at the moment. As well, there are reports that in the ‘grey market’ the new Greek debt is trading far below par; possibly reflecting little confidence on the part of debt investors in the country’s outlook. That at least is what many traders are inferring.

BACKDROP

Not to be missed either, this afternoon will see the release of the latest US non-farm payrolls data. Chinese CPI data out last night came in below expectations.

EQUITIES

French media and aerospace conglomerate Lagardere aims to keep its core operatingprofit stable this year after posting a steep net loss in 2011. That has elicited a negative reaction from some analysts.

The world’s second largest industrial gases producer, Linde, has increased its full-year dividend by nearly 14% after operating profit grew faster than expected in 2011.

The strongest sectors on the Stoxx Europe 600 are: health care (0.70%), travel leisure (0.66%) and retail (0.66%).

MACROECONOMY

German consumer prices rose by 0.7% month-on-month (2.3% year-on-year) in February, as expected.

The German trade surplus improved to €14.2bn in January, versus the €13.5bn expected by the consensus, from €13.9bn in the month before.

French industrial production rose 0.3% month-on-month in January (Consensus: 0.5%).

OTHER MARKETS

Front month Brent crude futures contracts are rising by 0.56% to the $125.44/barrel level.

The euro/dollar is down by 0.36% to 1.3229.

AB

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